When you take a look around your apartment or house your eye will probably cast a loving glance over everything from family treasures to your most prized and hard-earned items. Protect what makes your rental apartment or house a home with renters insurance. While landlords typically insure their property, their coverage only extends to the building itself.
Why You Need Renter’s Insurance
In the event of disaster- manmade or natural, renter’s insurance protects your prized possessions as well as you, against liability claims if someone else gets injured on your property. Here are the disasters renter’s insurance covers:
- Fire or lighting
- Windstorm or hail
- Riot or civil disturbance
- Vandalism or mischief
- Broken glass
- Falling objects
- Weight of ice, snow, or sleet
- Accidental discharge or overflow of water
- Sudden and accidental tearing apart
- Artificially generated electric charge
What Standard Renter’s Insurance Covers
- Personal property: insures the possessions you store in your home.
- Family liability: you’re covered in the event anyone has an accident or suffers injuries within your home.
- Guest medical protection: guests who enter are protected against injury.
- Living expenses: covers the costs you accumulate because you have to live elsewhere while your home is unavailable due to an aforementioned disaster.
Cash or Replacement?
There are two kinds of renter’s insurance: cash value and replacement cost. It’s important to be aware of the differences between the two.
Actual cash value: This coverage compensates you for the current value of the damaged or stolen property minus the deductible. For instance, if you shelled out $500 dollars for your favorite recliner three years ago and it’s damaged by fire, the insurance company will pay you the value of the recliner today. So while you paid top dollar for it a few years ago and it will cost you either the same amount or even more to replace it, you’re insured for the current, used value of the recliner.
Replacement cost: This sort of coverage states that the insurance company will compensate you for the cost of replacing your possessions, minus the deductible. In most circumstances you will pay for the item upfront and then send the insurance company a receipt for reimbursement. Replacement cost coverage is more expensive, but you might benefit later should the unexpected and unwanted occurs.
Additional Benefits and Coverage
If replacement cost or actual cash coverage isn’t enough to make you sleep soundly at night, there are other benefits or separate polices you may purchase. While the list of covered perils seems comprehensive, disasters such as floods and earthquakes aren’t on most lists. If you live in tornado alley or live in a location that historically sees natural disasters, think about adding coverage.
How to Get Renter’s Insurance
If you’re getting ready to move to a new place, start your inventory today. You typically have fewer and newer items when you move, so this is a perfect time to write down what you have and collect receipts. If you can’t inventory everything, it’s better to have a partial list than no list at all.
Adequately protect valuable items like jewelry or art work that appreciate in value. Ensure that you have enough coverage in the event these valuables are damaged, lost, or taken.
Make a movie or take pictures. Another great way to quickly inventory your possessions is to videotape your home or take pictures of what you have. Print the pictures or email them to yourself and make notes about each item. If you decide to make a movie, narrate as you go.
Use technology to help. You can take room-by-room inventory easily with personal finance software programs.