HO4 Homeowners Insurance

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Contributor, Benzinga
December 28, 2021

An HO4 homeowners insurance policy, sometimes referred to as renter’s insurance, provides coverage in the event your rented living space is damaged or becomes uninhabitable. Though you aren’t required to have an HO4 homeowners insurance policy by law, your landlord may require that you carry at least a certain amount of insurance coverage as a term of your lease. 

Read on to learn more about the importance of renter’s insurance, what you can expect your policy to cover and more. 


Key Points

  • HO4 homeowners insurance is an insurance policy for renters.
  • HO4 coverage covers your personal property and also provides liability and loss of use coverage.
  • Renter’s insurance does not cover the physical dwelling of the home you live in, making it much cheaper than homeowners insurance
  • Like other types of insurance, HO4 policies include a deductible and a maximum payout limit.

What is an HO4 Policy Form?

An HO4 policy form is a type of insurance protection that affords renters protections against loss due to covered perils. For example, if a fire breaks out in your apartment and you lose all of your furniture, your HO4 policy will help you pay to replace your furniture, as well as additional living expenses if your apartment becomes unlivable after the fire.

Renter’s insurance policies function in largely the same way that homeowners insurance policies do, with you paying a monthly premium in order to maintain your coverage. Renter’s insurance also includes a maximum payout benefit, which is the total amount of money that you can claim after a qualifying loss. 

When are HO4 Policies Typically Used?

HO4 homeowners insurance policies are usually used when you rent the space that you live in rather than owning it. Renter’s insurance policies are not the same thing as landlord insurance, which is homeowners insurance coverage for property owners who rent out their spaces, as this type of insurance only covers the exterior of the property that the landlord owns.

Renter’s insurance does not cover any portion of the physical dwelling that you live in because you do not own the space. This means that renter’s insurance policies are usually significantly more affordable than homeowner’s insurance — so even if you think that insurance is out of your budget, it’s worth it to take the time to explore your options, as coverage might be less expensive than you think. 

What do HO4 Policies Cover?

Most HO4 insurance policies include at least the following coverages.

  • Personal property coverage: Personal property coverage compensates you if your property is lost, damaged or stolen as a result of a covered peril. For example, if your rented apartment is broken into and someone steals your gaming console, your personal property insurance coverage will compensate you and help you pay for the cost of a replacement.

Your personal property insurance coverage usually compensates you for theft that occurs outside of your home as well. For example, if you leave your cell phone in your work locker and someone breaks into it and steals it, your renter’s insurance coverage would still cover you even though the theft did not occur in your home.

Personal property coverages also usually include limitations on high-value items. For example, though your HO4 homeowner’s insurance policy might include a total personal property coverage level of $10,000, it may also specify that you may only use up to $1,000 to replace jewelry. You may want to purchase a rider to extend your coverage on individual items.

  • Liability insurance: Liability insurance helps you pay for the cost of legal expenses and judgements incurred if someone injures themselves on your property and sues you for the cost of their medical bills. Liability insurance also helps you pay for legal expenses incurred if you damage someone’s property and they sue you for the cost of a replacement.
  • Loss of use coverage: If your home suffers major damage, it may come to the point where it is unsafe to live in. In these instances, your renter’s insurance coverage will help you pay for regular living expenses above what you’d normally spend living in your home. For example, loss of use coverage can help you cover the cost of an alternative living space until your home is repaired, as well as the cost of any meals out you would usually eat at home.

The specific coverages on your policy and policy limits will vary depending on the insurance company that you’re working with. Speak with an insurance agent before you sign onto your policy so you know the limits of your coverage before you sign up for coverage. 

What Perils are Covered Under a HO4 Policy?

HO4 policies protect you from some of the most common perils that may damage your living space. In the realm of insurance, a peril is a situation or source of loss that entitles you to file an insurance claim to compensate you. 

Some of the most commonly covered perils included on most renter’s insurance policies include:

  • Fire
  • Lightning
  • Wind and hail
  • Snow and ice collapse
  • Smoke damage
  • Theft occurring inside or outside of your home
  • Vandalism

Keep in mind that your insurance coverage will only compensate you for damage up to the limit specified on your policy. For example, if you have $10,000 worth of personal property coverage on your HO4 policy form, your insurance provider will not pay out more than $10,000 to replace your things after a covered loss.

Like any other type of insurance, there are a few situations when your renter’s insurance will not cover you. Some of the most common exclusions that you’ll find on renter’s insurance policies include:

  • Flooding (if you live in a high-risk flood zone, you can purchase an independent flood insurance policy through FEMA)
  • Earthquakes
  • Damage that you cause intentionally to your personal possessions
  • Bed bugs and other pests
  • Your roommate’s possessions

Exclusions and inclusions may vary by policy. 

Replacement Cost Coverage and HO4 Policies

There are 2 primary types of personal property insurance that you can choose from when signing onto coverage.

  • Actual cash coverage: Actual cash value coverage takes depreciation into account when calculating how much money the insurance company will compensate you for damage to your property. This means that if you purchased a laptop a few years ago for $1,000, you may only receive a fraction of this total cost due to depreciation.
  • Replacement cost coverage: Replacement cost coverage does not take depreciation into account when calculating your payout. This means that your insurance provider will offer you enough coverage to replace the items that you’ve lost with a replacement of similar value.

Most renter’s insurance policies come with actual cash value as a standard coverage, but you can usually upgrade your insurance to replacement cost coverage for an additional fee. 

How to Compare and Get an HO4 Insurance Policy

When comparing renter’s insurance policies, be sure to consider the following factors:

  • Your monthly premium: Your monthly premium is the amount of money that you pay each month to keep your coverage current. Be sure to select a policy that you know you can afford — your insurance provider can cancel coverage if you begin missing payments.
  • Your deductible: An insurance policy’s deductible is the amount of money you need to pay towards your damages when filing a claim before your insurance will offer you a payout. Choosing a higher deductible lowers your monthly premium but can make an incident more expensive.
  • Bundling opportunities: Most insurance providers that offer renter’s insurance policies also offer other types of coverage that you might need like car insurance or business insurance. If you already have an insurance policy with a major industry provider, consider exploring renter’s insurance options through this company first, as you may be able to save money on both policies through bundling.

To get started signing onto an HO4 homeowner’s insurance policy, start by collecting an online quote from at least 3 independent, competing insurance providers. Use these quotes to guide your search, and contact a representative when you’re ready to sign up for coverage. 

Compare Home Insurance

Not sure where to begin your search for HO4 coverage? Consider starting by getting a few quotes with the recommended providers below.  

Do You Need Renter’s Insurance?

If you’re living without renter’s insurance, you could be putting both yourself and your family at risk. Don’t be afraid to begin exploring your options for renter’s insurance early by collecting multiple quotes from competing providers. 

Getting a quote for insurance takes as little as 2 minutes — but can end up saving you hundreds of dollars throughout the year.

Frequently Asked Questions


What is an HO4 homeowners policy?


An HO4 homeowners insurance policy, sometimes referred to as renter’s insurance, is a type of protection that compensates you for legal liabilities and property damages sustained when you live in a rented space.


What is the difference between HO4 and HO6 insurance?


HO6 insurance is coverage for condominium owners and homeowners whose property shares communal features with others within the association. HO4 insurance is for renters who do not own the dwelling in which they live.


What is not covered in an HO4 policy?


The structure of the home that you live in is not covered under an HO4 policy. The structure of the home is covered by your landlord’s insurance. HO4 policies also do not cover any form of theft from your car or your roommate’s possessions. 

About Sarah Horvath

Sarah is an expert in the insurance, investing for retirement and cryptocurrency space.