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What Is Personal Liability Insurance for Renters?

Personal liability insurance for renters refers to a type of coverage that provides financial assistance to those whose property or person was damaged or injured due to your negligence. It is not required by law, though many landlords do require tenants to have liability coverage when renting their property. Personal liability covers dog bites, property damage and injuries incurred on the rental property by providing financial support for medical-related expenses for the injured party as well as your legal fees if you are sued. It will not cover business-related accidents, deliberate damage/injury caused by you towards another person or accidental damage/injury caused to you. Renters liability insurance is one of the cheapest insurance plans with monthly premiums averaging $15.

If you’re going to rent or you’re thinking about renting, below is an in-depth look at what liability insurance can do for you.

When Is Liability Insurance Needed?

Personal liability insurance is only required if your landlord stipulates such coverage is necessary as part of your rental agreement. Although you don't legally need personal liability insurance, you should still consider getting it as it helps protect you from financial burden if an accident does occur where you’re living and you are at fault. The typical renters policy includes liability coverage, personal property and additional living expenses. You can also get comprehensive personal liability (CPL) insurance as a standalone policy, but this is harder to come by. Below is a brief comparison between renters insurance and a standalone personal liability policy:

Renters Insurance

Personal Liability Insurance

Includes liability coverage, personal property, and additional living expenses

Covers damage to others or their belongings caused by you

More accessible than a standalone personal liability insurance plan

Standalone policies may be difficult to come by as renters and homeowners policies come with liability coverage

Personal liability insurance is only required if it's part of your rental agreement.

What Does Personal Liability Insurance for Renters Cover?

Personal liability insurance can help pay for someone’s medical bills or repairs to damaged property if you're responsible for their injuries or property damage. Renters liability coverage can also provide aid for legal expenses if you are sued due to an incident that takes place on your rental property. Your personal liability insurance should cover most claims and lawsuits caused by your negligence. Protection includes:

  • Covered losses away from home - Personal liability insurance may cover the costs associated with an accident that occurs away from your home. An example would be if you accidentally damaged a store’s lobby. Your liability coverage could provide financial aid if the business seeks compensation.
  • Damage to someone’s property - Personal liability coverage typically provides financial protection if you or someone else in your household causes damage to someone else’s property. For example, if you have a tree in your yard that is obviously dead and it falls on your neighbor’s fence and destroys it, you may be held liable for paying any repairs or replacement costs.
  • Dog bites - Personal liability insurance can help cover the costs associated with your dog biting another person. 4.5 million people are bitten by a dog every year with treatments for bites potentially being over $30,000. Most dog breeds are covered under your personal liability coverage. However, some are excluded. Breeds excluded often include:
    • Akitas
    • Alaskan Malamutes
    • Chows
    • Great Danes
    • Pit Bulls
    • Rottweilers
    • Siberian Huskies
    • Wolf Hybrids

 Ask your insurance provider about what dog breeds are excluded from your policy. If your dog is excluded, you can purchase additional liability coverage specifically for your pet.

  • Legal fees - Personal liability insurance might help cover legal costs and lawyer fees if someone sues you over property damage or a bodily injury.
  • Lost wages - Personal liability insurance may help cover lost wages if someone is injured on your property and it hinders their ability to work.
  • Medical bills to visitors - Personal liability coverage may help pay for the medical costs up to the limits of your policy if you’re held legally responsible for a guest’s injury that happened on your property. Common examples include slips and falls due to high-risk features like swimming pools and trampolines, faulty railings and stairs.

Renters seeking additional liability coverage beyond the limits of their renters insurance policy should look into getting a personal umbrella policy. Umbrella insurance coverage usually begins once the limits of an underlying policy, such as a renters policy, have been reached, helping provide greater liability protection.

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What Isn't Covered by Personal Liability Insurance for Renters?

Personal Liability insurance will not cover everything. Situations not covered by personal liability coverage include:

  • Business claims - Personal liability insurance usually will not cover activities or claims related to your profession if you run a business out of your home.
  • Car accidents - Personal liability insurance will not cover damages from car accidents. Separate liability coverage through your auto insurance policy will be used instead.
  • Deliberate injury or damage - Personal liability insurance will not cover any intentional damages or injuries you caused to another person.
  • Your own injuries or damages - Personal liability insurance will usually not provide coverage for accidental damages or injuries you cause to yourself or your household members.

How Much Renters Liability Coverage Do I Need?

The amount of renters insurance coverage you get is entirely up to you. Policies typically start with a $100,000 limit. However, there are some who suggest purchasing at least $300,000 worth of protection according to the Insurance Information Institute. Luckily, renters insurance is one of the cheaper forms of coverage with premiums being as low as $15 a month. Your premium is calculated using a number of factors that include:

*An actual cash value policy pays the original amount spent for the item minus its depreciated value. A replacement cost policy will pay the original value of the item up to the policy's limit. You will get an initial payment for the value of your property, regardless of which type of policy you have. Replacement value policies require you to provide receipts. Only then will you get a second payment for the difference between the replacement cost and the actual cash value.

Renters liability insurance is one of the cheapest insurance plans with monthly premiums averaging $15.

Personal Liability Insurance FAQs

Is renters insurance the same as liability insurance?

Renters insurance is not the same as liability insurance. Renters insurance is a group of coverages that include liability coverage, personal property coverage and additional living expenses coverage.

Won’t landlord insurance cover me?

Landlord insurance will typically not cover you as it is designed to provide financial protection to the landlord, not to the tenants. The liability protection of landlord coverage applies to injuries and damage wherein the landlord is found at fault.

How often should you shop for renters insurance?

You should shop for renters insurance every year as most renters policies have a one-year term. This helps ensure you find the best value for the coverage you need.

Key Takeaways

  1. It is not uncommon for landlords to require their tenants to have liability coverage, either through a standalone policy or a renters insurance policy.
  2. Personal liability insurance for renters can cover costs related to accidents caused by your negligence, such as dog bites from your pet, injuries from slipping and falling, damage to someone else’s property, legal fees, lost wages and medical bills for the injured party.
  3. Personal liability insurance for renters will not cover business-related injuries or damages, car accidents, deliberate injury or damage to yourself or your property or accidental injuries or damages to yourself or your property.
  4. Renters insurance policies typically have a $100,000 limit and cost an average of $15 a month. Premiums are calculated by looking at your coverage limit, your deductible, your location, the type of property being insured and whether your plan is an actual cash value policy or a replacement cost policy.

SmartFinancial can help get the coverage you need at the price you want. Enter your zip code below or call 855.214.2291 to receive your free renters insurance quotes.

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