If you are renting an apartment or a home you may want to consider purchasing Renters Insurance. Renters insurance cover three main areas such as personal property, temporary living expenses and personal liability and medical bills. Policies can cover theft, water backup damage, certain natural disasters, bodily injuries and more in a rented property. If you rent an apartment, home or even a dorm, renters insurance is recommended for protecting your space and belongings in the event of a covered accident. Here are a few tips to guide you through the purchase of renters insurance.
1. Are you required to buy renters insurance?
It's usually not a requirement but some landlords make renters insurance a condition of your lease. This is mainly so your belongings are covered if there is a fire or other damage to the building. Your landlord will likely have insurance, but only for the building itself. Read your lease in its entirety. You'll want to see if you’re required to have renters insurance, but you'll also want to be aware of other aspects of your agreement such as penalties for breaking your lease, rules on pets, or deposit refund policies.
2. What is a deductible?
A deductible is the amount you have to pay out of pocket to replace items before your insurance kicks in to cover the rest. If, for example, you have to replace about $5000 in items that were stolen from your home, and you bought insurance with a deductible of $1000, your insurance may cover up to $4000 of your expenses. When comparing policies, ask about whether the company pays to replace your items based on the current value of the item or on the replacement value. Replacement value is important. Even furniture can depreciate. For instance, if the 10-year-old couch you originally bought for $1,000 and would cost $1,000 to replace, is valued at $300 used, you’d have to pay $700 out-of-your-pocket to replace it even if your deductible is met.
3. What can you afford in premium and deductible costs?
The point of insurance is to make emergencies easier to recover from. Therefore, if you couldn’t afford to replace your belongs with a deductible that is over $1,000, don’t buy insurance with a deductible higher than that.
4. What about pets?
If you have a pet, your renter’s insurance might—or might not—protect you against liability if your furry friend bites a visitor to your apartment. Most policies do include liability coverage for pets. Inform your agent if you have a pet and be sure to ask your insurance agent about how to ensure that you are protected in the event of a pet bite.
5. Do you have a vehicle?
In many cases, your renter’s insurance covers the loss of your possessions that are inside your car. However, it doesn’t cover the physical damage that happens during a crime. Therefore, if a thief smashes in your windows to snatch your valuables out of the car, the physical damage to the glass is not covered.
While you’re chatting with your insurance agent about tenant’s insurance, ask about bundling your auto policy to be sure you have enough coverage.