Difference Between Renter’s Insurance and Contents Insurance (With Table)

Compensation for the losses due to accidental fire or any other damage is worthy, and we call it Insurance. While this is a long term attribute, some insurances are available as a short term aspect too. 

Moreover, any loss is a loss. Renter’s insurance and Contents Insurance fall under the same category. These two types of insurances have many things in common, but there are a few significant differences between them.

Renter’s Insurance vs Contents Insurance

The difference between Renter’s insurance and Contents insurance is the possessions that can be claimed as insurance due to any accident that may occur while you stay at a house. The renter’s insurance can help you claim the possessions that are considered personal property as you have set that up in the house. It can be any alterations in the structure as well. Whereas contents insurance can help you claim the possessions that you have at home like furniture, jewels, clothing etc.

Renter’s Insurance is a coverage that is offered to protect the renters who live in a rented or leased property. The renter insurance shall cover personal property; the one that you have made changes like repair or replacement at the house, liability; if you had damaged someone else’ property and you pay the bill and also your guest’s medical bills.

Contents insurance, on the other hand, is offered to protect the personal belongings of yours if it is damaged by accident or even theft. The term content refers to those personal belongings that you shall take along with you as you move out of that premises to another house.

Comparison Table Between Renter’s Insurance and Contents Insurance

Parameters of ComparisonRenter’s InsuranceContents Insurance
CoveragePersonal Property that you have set up in your rented houseBelongings that you have at your house. It can be a rented house or your own house.
LiabilityThere is a provision to claimThere is no provision to claim
Theft Outside the premisesIt cannot be claimed if personal property is not covered in the insurance.Has complete provision to claim
Insurance TypeStand-alone insuranceContents insurance can be combined with Home insurance too.
Insurance Claim for Stolen MoneyIt cannot be claimed.Can be claimed

What is Renter’s Insurance?

It is that type of insurance that covers the damage that occurred to your personal property as you stay at a rented house. The personal property here means the alterations made to the structure of the house, repair and replacements made at the house. If that is damaged due to fire, theft and any kind of man-made damage shall be claimed.

In case of fire, the damaged clothes and furniture can be claimed. The claim amount shall be matching with the replacement cost for the same. The renter’s insurance has different coverage policies. If personal property is covered, then the theft of the items shall be claimed too.

Though it is seen that the renter’s insurance can help you claim almost all you own, there are a few limitations too. In case there is a jewellery theft or damage due to an accident, it cannot be claimed fully. There is an additional policy you might have to take to cover those valuables under one umbrella.

Renter’s insurance has provision as liability coverage. That means to say if you unexpectedly injure someone and if it is legal, you can claim the bills that you pay for the medication. At the same time, if there is an accident by you or your family that damages a neighbour’s property, the bills that you pay can be claimed as well.

The major help a renter’s insurance can offer is the additional living expenses. What if the house you stay in is uninhabitable due to an accident? You can still claim the expenses incurred to make it stay worthy.

What is Contents Insurance?

This is a type of insurance that covers the damage that has occurred to the contents that you have at home. It can be electronic items, furniture, jewellery, money or even anything that you possess as content at home. Say, for example, a television, a microwave oven can be covered under this insurance.

Contents insurance is done on the contents available at home. In case of any accident like fire, theft, or any damage can be used to claim the insurance. As the cost of replacing these valuable items shall be expensive, this insurance is of greater support.

It is not necessary that you must be in a rented property. It can be your own home, and you have these with you at home. Contents insurance shall cover the theft of these articles too. The theft might have happened like a break-in, or it might have happened outside the premises. It shall be still covered. Unlike the renter’s insurance, you need not take any additional policy for it.

There are indeed two types of contents insurance cover, Old and new. The categories determine the claim amount. If it is relatively new, a full cover is possible. The additional cover, in this case, is available, but as such, this insurance itself is sufficient for most of the articles at home.

Main Differences Between Renter’s Insurance and Contents Insurance

  1. The main difference between Renter’s Insurance and Contents Insurance is the possessions that come under the coverage. Renter’s Insurance shall cover the damage or theft that has occurred to the personal property that is at your rented house. While the contents insurance covers the items that are available at home. While the former has the provision to claim for the personal belongings but an additional policy needs to be purchased to claim the same.
  2. The renter’s insurance shall help you claim for the medical bills that you have paid for your guests. Contents insurance does not have anything of that sort.
  3. The theft of jewellery or stolen money cannot be claimed using renter’s insurance, while contents insurance is readily available to cover the same.
  4. Renter’s insurance is stand-alone insurance that can have multiple additional plans added to it, while Contents insurance can also be purchased along with home insurance.
  5. Renter’s insurance requires you to add additional policy measure to cover theft outside your premises, while contents insurance can be readily claimed if such incidents happen.

Conclusion

It is the awareness factor that makes people have insurance cover. Not many people are aware of contents insurance. Even if they know such a thing exists, they do not insure it as they do not calculate the cost of items at home. The good news about contents insurance is, you can replace the items at the same cost. 

At the same time, a renter’s insurance has its benefits if you plan to buy and keep things at home or if you make any changes to the existing structure of the house. We do not know what can happen in the case of an accident or theft. We cannot predict the loss, but we can easily claim it though.

References

  1. https://www.sciencedirect.com/science/article/abs/pii/S0016718515302207
  2. https://go.gale.com/ps/anonymous?id=GALE%7CA11669867&sid=googleScholar&v=2.1&it=r&linkaccess=abs&issn=00223905&p=AONE&sw=w
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