Renters Insurance Glossary: Every Term Explained in Plain English
Renters insurance protects your stuff, your wallet, and your living situation, but only if you understand what your policy says. This glossary explains the 13 terms renters ask about most, from personal property to recoverable depreciation, with real-world examples.
What is personal property coverage?
Personal property coverage pays to repair or replace your belongings, like furniture, electronics, and clothes, after a covered loss such as fire, theft, or water damage from a burst pipe. It protects your things even when they're outside your apartment, like a laptop stolen from your car.
What is personal liability coverage?
Personal liability coverage pays if you're legally responsible for injuring someone or damaging their property. Example: a kitchen fire you accidentally start damages your landlord's cabinets and appliances. It can also cover legal defense costs.
What is loss of use coverage?
Loss of use, also called additional living expenses, pays the extra costs of living somewhere else when a covered loss makes your home unlivable. That includes hotel stays, meals, and higher utility bills while repairs happen.
What is medical payments to others coverage?
Medical payments coverage pays small medical bills for guests who get hurt in your home, regardless of who's at fault. It handles minor injuries quickly and can help prevent a larger liability claim.
What are covered perils in renters insurance?
Covered perils are the specific events your policy protects against, such as fire, smoke, theft, vandalism, windstorm, and certain types of water damage. If an event isn't on the list, it isn't covered. At Kanguro Insurance, covered perils include fire or lightning, windstorm or hail, explosion, riot, aircraft, vehicles, smoke, vandalism, theft, falling objects, weight of ice or snow, accidental water or steam discharge from plumbing, HVAC or appliances, freezing of those systems, power surges, and volcanic eruption.
Does renters insurance cover flooding?
No. Standard renters insurance doesn't cover flooding from rising water, like storm surge or an overflowing river. Flood coverage requires a separate policy, such as one through the National Flood Insurance Program (NFIP).
Water from a burst pipe or appliance leak is usually covered. At Kanguro Insurance, flood and storm surge aren't covered in Florida, Georgia, or Texas, and water that backs up through sewers or drains is covered only with the optional water backup endorsement.
What is a hurricane deductible?
A hurricane or windstorm deductible is a separate, often higher deductible that applies to wind damage from a named storm. It's common in Florida and Texas policies. At Kanguro, Florida policies have a separate hurricane deductible that applies once per calendar year, with $500 or $1,000 options. In Georgia and Texas, your standard deductible applies.
Related: Renters insurance and hurricanes
What is a renters insurance deductible?
In renters insurance, the deductible is the amount subtracted from each covered claim payout. Choosing a higher deductible lowers your premium.
What is actual cash value (ACV)?
Actual cash value is what your item is worth today: its replacement cost minus depreciation for age and wear. A five-year-old laptop pays out far less than what a new one costs. Kanguro renters policies settle claims at actual cash value unless you add replacement cost coverage.
Example: A TV that cost $800 new, with $400 in depreciation, pays $400 at ACV.
What is replacement cost value (RCV)?
Replacement cost value pays what it costs to buy a new item of similar kind and quality, without subtracting depreciation. It usually costs a little more than ACV coverage but pays out much more after a loss. At Kanguro Insurance, it's available as an optional replacement cost endorsement.
Example: That same TV pays about $800 at replacement cost.
What is recoverable depreciation?
Recoverable depreciation is the part of your claim held back from the first ACV payment. On a replacement cost policy, you collect it after you actually replace the item and send proof of purchase.
What are special limits in renters insurance?
Special limits, or sublimits, cap how much a policy pays for certain categories, like jewelry, cash, electronics, or designer handbags, even if your overall personal property limit is higher.
What is a home inventory?
A home inventory is a list of your belongings with photos, estimated values, and receipts. It speeds up claims, proves ownership after a theft or disaster, and helps you choose the right coverage amount.
At Kanguro Insurance: Build yours with our inventory calculator.
What is scheduled personal property?
Scheduled personal property is extra coverage you add for specific valuable items, like an engagement ring, a laptop, or a bike, so they're insured above your policy's special limits. You list each item with its value, and it's covered up to that scheduled amount.
Example: If your ring is worth $3,500 but your policy caps jewelry theft at a lower special limit, scheduling the ring covers it for the full $3,500.
At Kanguro Insurance: Add the Scheduled Personal Property endorsement for an extra premium. You can schedule jewelry, designer clothing and furs, home office equipment, musical instruments, fine art, stamps and coins, rare books, silverware, cell phones, bikes and e-scooters, personal electronics, cameras, sporting equipment, and high-value appliances.
