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How does homeowner’s insurance vs renters or tenant’s insurance differ?


Whether you own a home or stay in a rented property, it is important to keep all the contents secure through a home insurance policy. In case you own a home, a homeowner’s insurance is highly recommended, as it keeps the structure as well as the contents secured. In case you have a rented home, the insurance is purchased by the owner. However, you need to get an insurance for the contents inside the home.

 You can reach out to a reputed house insurance company to check out the popular schemes they have designed. Both homeowner’s insurance and tenant’s insurance need regular payments. You may opt for a lumpsum annual payment or go for monthly payments. In case any damage occurs to the home of its contents, you can file a claim. In both these types of property insurance, you need to pay a deductible in case you file a claim.

Coverage provided by both homeowner’s insurance and tenant’s insurance

 Here are certain aspects that are covered by both these types of insurances.

  • Lightning and fire
  • Explosions
  • Hail and windstorm
  • Riots
  • Smoke damage
  • Damage caused by aircraft
  • Theft
  • Vandalism
  • Damage caused by a vehicle other than yours
  • Falling objects
  • Volcanic eruptions
  • Weight of sleet, ice or snow
  • Damage caused due to appliances, water or steam heating
  • Freezing of heating, plumbing or air conditioning
  • Damage caused by short-circuiting by various electrical appliances

When you have a property insurance in place, you can also enjoy a coverage if your property is stolen, regardless of whether or not it is your own home. For instance, if your laptop gets stolen from your home, you can file a claim for the loss. 

Besides, you can also enjoy a personal liability coverage. This will come handy if you are sued by anyone for causing damage to their property. Besides, if any person suffers an accident inside your home, you need to shoulder the liability. The home insurance policy will prove beneficial in managing these expenses.

Both homeowner’s and tenant’s insurance cover temporary living costs. If you need to evacuate the property after the disaster, you may have to get a temporary rental or hotel. Besides, the coverage is also provided to manage other expenses, including food.

Coverage provided only by homeowner’s insurance

A homeowner’s insurance comes with a coverage that you can use to rebuild your home, in case it is destroyed or damaged. However, you need to take a note of the perils that the policy covers. Other structures in your property may also be covered, including sheds and garages. In case you stay in a rented home, this coverage is not included in the policy. The reason is that, you actually do not own any home of your own and hence, do not need to spend money on repairs. In case the rented property is damaged, the landlord needs to bear the expenses the homeowner’s policy will be used in these situations. Get across to one of the reputed property insurance companies and get your home secured.

Exclusions of homeowner’s and renter’s insurance

 The homeowners and tenants should be aware of the perils that the insurance policy does not cover. Generally, the policies do not include damage caused by floods. You may want to keep your home insured against earthquakes. Check out the home insurance policies that provide coverage for these disasters.

Considering the liability factor, none of these insurances will cover you for damage done to your home or injuries, while you are in a motor vehicle inside the premises of your home. These damages are generally covered by motor insurances. 

 Cost of homeowner’s and tenant’s insurance

 The cost factor, apart from the structural coverage, is one of the key differentiators between a homeowner’s and tenant’s insurance. Homeowner’s insurance cost a lot higher than renter’s insurance. The logic is simple, as the former covers a lot more value than the other. If you are the homeowner, you need to keep the entire structure secure, along with its contents. However, a person staying in a rented home simply need to cover the belongings and not the structure of the building. Evidently, a homeowner’s insurance would cost much more than a renter’s insurance. In order to know the house insurance premium, check out the websites of the reputed insurance companies.

Factors affecting the cost of homeowner’s insurance

You are aware of the reason why the cost of homeowner’s insurance is higher. However, you need to consider several other factors that determine the quote of premium. The factors that might determine the premium include:

  • Proximity to the fire station, the closer it is to the station, the lower would be the premium
  • The materials used to build your home, considering the wooden homes are more prone to damage
  • The age of your home, since it might be more expensive to rebuild old homes
  • The present condition of your home
  • Size of the property, consider that larger the homes, the more susceptible they are to robberies
  • Rates may be high if you have already filed a claim in the past
  • The valuables in your home also determine the premium, as you may have to pay a high premium if you want a cover for jewellery

It is recommended to have a property insurance in place, so that you can enjoy the cover in times of unexpected expenses.

In case you are living in a rented home, the property owner may require you to buy a renter’s insurance. However, it is up to you whether you want to secure your property or not. The higher the value of your belongings, the more important it is to get them insured. The reputed home insurers have come up with plans that cover most of the perils. Besides, you can get these insurances at an affordable price. Visit the online portals and explore the available options. Whether you are a homeowner or a tenant, you should buy a home insurance and keep yourself financially secure. Buy the insurance from a reputed company, evaluating the amount of coverage you may need.

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