Rental Insurance Glossary of Terms

1. Rental Insurance (Renters Insurance): A type of insurance that provides coverage for individuals who rent or lease a residential property against various risks and liabilities.

2. Policyholder: The individual who owns the rental insurance policy and pays the premiums.

3. Insurer: The insurance company that provides the rental insurance coverage and assumes the risk.

4. Premium: The amount paid by the policyholder to the insurer for the coverage provided under the rental insurance policy. Premiums can be paid annually, semi-annually, quarterly, or monthly.

5. Coverage Types:

   a. Personal Property Coverage: Protection for the policyholder’s belongings and possessions against covered perils, such as fire, theft, and vandalism.

   b. Loss of Use Coverage: Coverage that pays for additional living expenses, such as hotel stays and meals, if the rental property becomes uninhabitable due to a covered event.

   c. Liability Coverage: Protection against legal claims and lawsuits for bodily injury or property damage caused by the policyholder to third parties.

   d. Medical Payments Coverage: Coverage that pays for medical expenses for third parties injured on the insured property, regardless of fault.

   e. Additional Coverage: Additional protections or enhancements that can be added to the standard rental insurance policy, such as coverage for valuable items, identity theft protection, and earthquake coverage.

6. Named Insured: The individual or entity listed on the rental insurance policy as the primary policyholder.

7. Additional Insured: An individual or entity added to the rental insurance policy with limited coverage, often applicable in specific situations.

8. Exclusion: Specific situations, perils, or property types that are not covered by the rental insurance policy.

9. Deductible: The portion of a claim that the policyholder must pay out-of-pocket before the insurance coverage starts.

10. Subrogation: The right of the insurance company to recover its losses from a responsible third party after paying a claim to the policyholder.

11. Inventory List: A detailed list of the policyholder’s belongings and their estimated value, often helpful when making a claim.

12. Actual Cash Value (ACV): The coverage that pays the cost to replace damaged property minus depreciation.

13. Replacement Cost Value (RCV): The coverage that pays the cost to replace damaged property with new items of similar kind and quality, without depreciation being considered.

14. Temporary Residence: A location where the policyholder stays temporarily, such as a hotel or friend’s house, while the rental property is undergoing repairs due to a covered event.

15. Proof of Loss: A formal statement submitted by the policyholder to the insurer regarding a claim, including details of the incident and the claimed amount.

16. Perils: The specific risks and events covered by the rental insurance policy, such as fire, theft, and certain natural disasters.

17. Renters’ Liability: The legal responsibility of the renter for damages to the rental property or injuries to others while on the premises.

18. Renters’ Insurance Score: A score based on various factors used by insurance companies to determine the risk associated with insuring a renter.

19. Renters’ Insurance Binder: A temporary proof of rental insurance coverage provided by the insurer until the formal policy is issued.

20. Renters’ Association Insurance: Insurance provided by a renters’ association to cover common areas and shared property in a multi-unit rental complex.

21. Renters’ Insurance Endorsement: An amendment or addition to the rental insurance policy that modifies or expands its coverage.

22. Personal Liability Umbrella Policy: An additional policy that provides extra liability coverage beyond the limits of the standard rental insurance policy.

23. Loss Assessment Coverage: Coverage that protects the renter against special assessments charged by the renters’ association following a covered loss affecting common areas.

24. Per Occurrence Limit: The maximum amount the insurer will pay for each covered incident or claim.

25. Aggregate Limit: The maximum amount the insurer will pay for all covered incidents or claims during the policy period.

Remember that rental insurance policies can have variations depending on the insurance provider and specific policy terms. Always review and understand the details of your rental insurance policy carefully to ensure it adequately protects your belongings and provides the liability coverage you need as a renter.