If you are a landlord or tenant, you will want to protect the contents of your rental property. As far as landlord insurance goes, the structure is your biggest concern, but appliances and furniture are significant investments as well. You need to know how insurance will cover these things and help you avoid any unexpected costs if anything is damaged or lost.
Most homeowners and renters insurance policies include personal property coverage for appliances and furnishings, such as refrigerators, washers, sofas, and dining sets. Generally, these items are safeguarded against standard hazards such as fire, theft, vandalism, and some forms of water damage.
Coverage usually is either actual cash value (ACV) or replacement cost. ACV factors in depreciation, so you’ll get the current value of the item when it’s lost. Replacement cost coverage, on the other hand, reimburses you for the cost to replace the item with a new one of comparable kind and quality without taking depreciation into account.
Look at the limits on your policy. Any high-value items or appliances could exceed the standard coverage limits. In those cases, you should consider additional endorsements or riders to cover them. Having an up-to-date home inventory, along with receipts and photographs, will make a big difference when filing a claim.
Landlords who rent out furnished apartments and homes should know that their standard property insurance may not fully cover those contents. In these cases, a landlord insurance policy with contents coverage is a must. This protects items such as beds, couches, and kitchen appliances from damage caused by covered perils.
Tenants who are renting furnished units should also consider renters' insurance. While the landlord’s policy might cover the furnishings themselves, it usually won’t cover the tenant’s personal property or liability. Renters insurance can fill that gap. It protects their belongings and provides liability coverage if the landlord's property is damaged as well.
The insurance policy should clearly define who is responsible for damage to furniture and appliances. This prevents fighting and clarifies each side’s responsibilities.
As soon as you suffer any loss or damage, inform your insurance company and give them full details. Photos, receipts, and a list of the damaged items may be useful for your claim.
The insurance company will then determine if a claims adjuster needs to review the damage or ask for additional documents. Be prepared to provide the age, condition, and value of damaged items, including model numbers and purchase dates.
Once you have the go-ahead, the reimbursement will be paid out based on your coverage type: ACV or replacement cost. Sometimes, insurers may pay out the depreciated value initially and then release additional funds once the item has been replaced.
Knowing what you have covered and keeping accurate records can make all the difference in protecting your appliances and furnishings. And the right insurance coverage will minimize your financial setbacks and keep your house or rental property running.
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