Renters Insurance: What Does It Cover, and What Does Your Landlord's Policy Leave to You?

What does a renters policy actually do?

Most renters policies do three things:

Policies vary, and some include other pieces, so the three above are the shape of most renters policies rather than a promise about yours.

Is the number on my policy enough?

The personal property limit is the most the policy will pay for everything you own, combined. Many renters pick a number at checkout and never add up what a full apartment actually holds: furniture, electronics, clothing, kitchen equipment, sports gear, a bike.

Two other details decide what a check would look like:

The fastest way to know your number is to make an inventory. Our free home inventory template works for a one-bedroom apartment as well as it does for a house.

Does it cover my roommate, my storage unit, or my car?

Renters insurance typically covers the named insured and the members of their household. A roommate who is not listed on the policy is generally not covered for their own belongings. Two roommates usually means two policies, or one policy that names both.

Things you keep somewhere other than the apartment, such as a storage unit or your car, are often covered, but at a reduced limit, commonly around 10 percent of the personal property limit. If the storage unit holds anything valuable, that is worth confirming rather than assuming.

What about water that backs up from a drain?

This is the surprise exclusion. A burst pipe is usually paid. Water that backs up through a drain, a toilet, or a sump pump usually is not, unless the policy has a water or sewer backup endorsement added to it.

It catches renters twice. The landlord's policy covers the building, not your belongings. And a lease that requires renters insurance does not mean the basic policy includes backup coverage. Without the endorsement, your things are usually not paid for even when the building or the city was at fault. (More on how sudden and gradual water damage are treated.)

What if I can't live in my apartment for a while?

After a fire or serious water damage, loss of use coverage can help pay for a hotel or a temporary rental and the extra costs of living somewhere else while repairs happen. It pays the additional cost above what you normally spend, not all of your living expenses.

The limit works differently from policy to policy: a dollar amount, a percentage of your belongings coverage, or a time limit such as 12 or 24 months. Knowing which one yours is before you need it is worth a two-minute conversation.

Does it cover my e-bike or scooter?

A regular bicycle is usually treated as a belonging. An e-bike or a scooter has a motor, and many homeowners and renters policies treat motorized vehicles differently for theft, damage, and especially liability. Rules for e-bikes are also changing state by state. If you own one, it is worth asking specifically rather than assuming it is treated like a bike.

What does the lease not tell you?

Here is the part the lease does not tell you. A lease that requires renters insurance is checking that a policy exists. It is not checking whether the limit matches what you own, whether the policy pays replacement cost or depreciated value, whether your roommate is on it, or whether water backup is included. All four are printed in the policy, and all four are the kind of thing people find out about after the claim.

CoverageDecoder asks whether you have roommates, keep belongings in a storage unit or another location, or own an e-bike or scooter. It also asks about past sewer or drain backup. The report explains the topics your answers point to and hands you the questions worth asking your agent, in words you don't need a law degree to understand.