Many people in the United States and all over the world rent a home instead of own one. Purchasing a home can be quite costly and for many people, the cost is just too much. Others would rather not have the extra responsibility of owning a home, so they decide to rent a home instead. Regardless of your reasons for renting a home, you as the renter have quite different responsibilities than your landlord does when it comes to insurance needs for the home and contents.

The landlord is responsible for insurance coverage for the structure of the home itself. As a renter, you are not responsible to have insurance coverage for the structure. The landlord needs to have dwelling insurance—insurance that only covers the structure of the home and none of the contents or liabilities that may arise. Dwelling insurance also covers the contents that your landlord owns—such as appliances and some furniture. Some dwelling insurance also comes with liability insurance included, but it’s important to find out whether you the renter or your landlord will be responsible for liabilities that happen inside the dwelling.

By its very nature, the idea of homeowners insurance is comforting to anyone who wants to protect a home investment. That comfort, however, can be short- lived if disaster strikes and the homeowner suddenly discovers that the scope of his or her insurance coverage is not great enough to cover the damage and any associated liabilities.

News coverage of recent and ongoing natural disasters in the United States has highlighted the importance of having the right homeowners insurance coverage to protect homeowners and their families.

Standard homeowners insurance policies should cover the cost of replacing the structure of the home in the current construction market, replacement of personal possessions, the cost of alternate accommodation if the homeowner is forced out of his or her home during repairs, and finally, adequate protection against liability suits from others who may have been injured in the home or had their possessions damaged as a result of something the homeowner did (for example, letting the bath tub overflow and causing water damage to another unit in a multi- family building). Construction costs have skyrocketed over the last two decades, so homeowners should be sure to keep their policies in line with present- day costs and inflation levels rather than at a level that may have been adequate when the policy was first purchased.

If you are living in a home that you own, and you are paying for a home owner’s policy that covers only the goods in your home, then you are not paying for enough coverage should the worst happen. You will be paid for the goods that you lost when your house was destroyed with nowhere to put them! No one wants to think about their home being destroyed or damaged by fire, storm, snow or anything else. The prepared home owner, however, will have thought of these things and formed a line of defense, not the least of which is insurance.

When you move into your home – any home – you should begin thinking about the coverage that you need. A good broker can help you with this process, but it is great if you have thought about it before calling one, too. Do you own the walls, or just the property within them? Do you own the outside of the building (if you live in a condo, then the roof and outer walls might be owned and therefore protected by the home owner’s association)?