Why do I need Renter’s Insurance?
Did you know? Just because your landlord has coverage doesn’t mean that you do, too.
In most cases, your landlord’s insurance policy covers only structural damage to the building itself. It’s true – if the structure goes up in flames, your landlord’s coverage would include repairs to the building, but not reimburse you for your possessions. Renter’s insurance protects your possessions in case of a loss from fire, smoke, lightning, vandalism and theft. It also extends beyond on-premise theft and hazards, covering property that is stolen from your car or is lost or damaged anywhere you happen to be, from Mexico to Europe to your next-door neighbor’s house.
The first step: Answer this question. What do you think your belongings are worth? Conducting a thorough home inventory might be an eye-opening experience since the value of your furniture, DVD collection, clothing, books and moveable appliances can really add up. Without coverage, replacing these items could be a real financial hardship. With renter’s insurance, you are covered.
Secondly, if you have valuables such as expensive jewelry or collectibles, an endorsement to a renters insurance policy can add to the policy’s provisions. What does this mean? In the event of a covered loss, the amount of insurance is enough to cover the repair, replacement or cash reimbursement of the item, which means that your expensive camera equipment or wedding ring can be covered, too.
Renters insurance provides protection against both property loss and liability (liability provides protection in the event that you cause injury or property damage). To learn more about what that means, read below. We’ve covered some basics about each.
Renter’s insurance covers your possessions against damage for things such as fire, smoke, lightning, vandalism, theft and water damage (but not flooding)—and that’s just to name a few.
Renter’s insurance also extends beyond on-premise theft and hazards, covering property that is stolen from your car, or is lost or damaged anywhere you happen to be.
In addition to protecting your personal property, renters insurance also protects you in the event that you are responsible for injury or property damage to others. For example, if someone slips and sprains his or her ankle at your annual birthday bash, you’re likely already protected.
Liability also provides coverage for legal defense costs and judgments in a lawsuit, whether the incident occurred within your rented residence or elsewhere.
There are two personal property coverage options to choose from: replacement cost value or actual cash value. Here at Friedle Insurance Agency, we recommend insuring your personal property for its replacement cost value. Here’s an example to illustrate the difference:
The furniture you bought a few years ago for $650 is now worth only $100, but today costs $900 to replace. With an actual cash value policy, you would get reimbursed the current depreciated cost minus your deductible. However, if you have replacement cost for your personal property, you would collect the full cost to replace the furniture, less your deductible.
Your belongings hold less value the longer you own them. Replacement cost value ensures that you can replace yesterday’s purchases at today’s prices.
Is Renter’s Insurance Coverage Affordable?
Because renter’s insurance covers only the value of your belongings, not the building, the premium is relatively inexpensive. For about the same cost as going to the movies once a month, you can gain peace of mind, regardless of life’s unexpected mishaps.