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CA Department of Insurance

Renters need to consider their recovery plan before disaster strikes

News: 2015 Press Release

For Release: February 24, 2015
Media Calls Only: 916-492-3566
Email Inquiries: cdipress@insurance.ca.gov
Renters need to consider their recovery plan before disaster strikes

SACRAMENTO, Calif. - California faces the constant threat of devastating fires, floods and earthquakes. In some communities that have experienced disasters in the past year, such as Weed, where the Boles fire ravaged over 150 homes and Napa, which experienced the most damaging earthquake in 25 years, the percentage of renters runs near or over 50 percent of residents. However, a 2014 Insurance Information Institute poll found that 95 percent of homeowners had insurance coverage while only 38 percent of renters had insurance to protect their belongings.

"Many renters don't know that their landlord's policy covers the structure and does not protect their possessions in the event of a fire or other disaster," said Insurance Commissioner Dave Jones. "For relatively little money, renters can insure their belongings and make recovery from a disastrous event much easier. I urge renters to make sure they are prepared and protected from California's next catastrophe."

To protect yourself from a devastating financial loss, the Department of Insurance offers the following tips to help determine if renters insurance is right for you.

Renters insurance 101

  • If you are a renter, your landlord's insurance doesn't cover your personal property in the event that it is stolen or damaged.
  • The premiums for renters insurance average between $15 and $30 per month.
  • In addition to personal belongings, some policies will also cover living expenses if your apartment or home is uninhabitable due to damage.
  • The personal liability portion of a renter's policy will provide you with a legal defense and pay for damages if a court determines you are negligence resulting in an injury or property damage to another person.
  • Coverage generally provided under most renters insurance policies:
  • Personal property coverage pays to repair or replace personal belongings if they are damaged, destroyed or stolen.
  • Additional living expenses coverage helps pay for reasonable and necessary costs incurred when a loss makes a residence uninhabitable, which may include hotel, food and other expenses.
  • Liability insurance provides coverage against a claim or lawsuit resulting from bodily injury or property damage to others caused by an accident while on the policyholder's property.
  • One important factor to consider when shopping for renters insurance is actual cash value vs. replacement cost coverage settlement option. Actual cash value coverage will reimburse the renter for the depreciated value of the personal property at the time of the claim, minus the deductible. For example, if a flat screen television were stolen from an apartment, five years after the television was purchased, the policyholder would be reimbursed for the depreciated amount (i.e. what the old one is worth minus the deductible). Replacement cost coverage, on the other hand, allows the renter to replace the lost or damaged possessions with similar items at current market value (i.e. what it actually costs to replace the items lost minus the deductible).

Beyond insurance:

  • Use our home inventory guide or an App like the National Association of Insurance Commissioners (NAIC's) MyHOME home inventory tool to quickly document your belongings and calculate the value of your possessions. This way you know how much coverage you need and you have documentation if you experience any losses.
  • Make an emergency plan for yourself and your family so both you and your possessions are covered.

Media Notes:

  • California Department of Insurance publications and resources:
  • More information about renters insurance can be found on the NAIC website.
  • Information regarding the NAIC's home inventory app.
  • American Red Cross emergency preparedness checklist.


The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $289 billion in premiums annually in California. Since 2011 the California Department of Insurance received more than 1,000,000 calls from consumers and helped recover over $394 million in claims and premiums. Please visit the Department of Insurance web site at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800.927.HELP or 213.897.8921. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.

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