Renter's Insurance in Texas
Insurance companies sell two types of renters policies. They have different amounts of coverage.
- Named-perils policies cover property that's lost or damaged because of events listed in the policy, such as fire and theft. These policies won't cover losses caused by events that aren't listed in the policy. Named-perils policies are also called specified perils policies.
- All-risk policies cover every type of loss, unless the policy excludes it. These policies are more expensive than named-perils policies because they cover more losses. All-risk policies are also called comprehensive or open-perils policies.
All renters policies have a total dollar limit. The dollar limit is the most the insurance company will pay you for a claim, even if the cost to repair or replace your property is higher. Make sure you buy a policy with a high enough dollar limit to replace your property if it's stolen or destroyed.
A deductible is the amount of a covered claim you pay. For example, if you have $25,000 in damages with a $250 deductible, the insurance company will deduct $250 from the amount it pays you.
Renters insurance policies typically include three types of coverages: personal property coverage, loss of use, and personal liability.
- Personal property coverage pays to repair or replace your personal property, up to your policy's dollar limit. In addition to a total dollar limit, policies may limit payments for certain kinds of property. Common limits are $100 for cash, $2,500 for personal property used for business, $500 for valuable papers, and $500 for jewelry, watches, and furs.
- Renters insurance also covers your luggage and other personal items when you travel. This coverage is usually limited to 10 percent of the amount of your policy or $1,000, whichever is greater.
- Loss of use pays your additional living expenses for things like food and rent if you have to temporarily move from your house or apartment. Loss of use coverage is generally limited to a percentage of a policy's personal property coverage.
- Personal liability protects you against a claim or lawsuit if someone is injured in your home. The amount the policy will pay varies by company.
Note: Ask about buying additional coverage if the value of your personal property is more than your coverage limits. People often buy endorsements to add or increase coverage for jewelry, fine arts, antiques, computers, and electronics.
Also consider additional liability coverage if you don't think the basic limits are high enough. Your company might require higher limits if you have potentially dangerous items like a pool or trampoline.