While the property you’re currently residing in might not belong to you, as a renter you still face exactly the same risks as someone who owns their own home, and while your landlord may have insurance, it protects only the building and does absolutely nothing to protect your personal belongings. Fires, theft, flooding, accidents and natural disasters can all happen to you in your rented home, and without adequate renters insurance, your belongings are at risk.
What you should do before you purchase renters insurance:
Before talking with an insurance specialist
to get your belongings protected in the event of damage, theft or destruction, you should make a detailed inventory of each and every item that you want the policy to cover. Wherever possible, list each item along with its value and serial number, if you have receipts for larger or more valuable items, it’s a good idea to hang onto them.
What is standard renters insurance?
A standard renters insurance policy will cover you against named perils and offer you liability protection. Some more common examples of named perils found in renters insurance coverage are fire, lightning, wind, smoke, vandalism, theft and falling objects. Liability protection covers injury to another person that occurred on your rented property, and in some cases, might even cover your legal defense costs.
It’s important to note that such natural disasters as floods and earthquakes are not usually on the list of covered items, and if you think your personal belongings are likely to be affected by such an event, then you’d be advised to buy a separate policy.
Renters insurance and additional living expenses:
In the unfortunate event of your rented property becoming uninhabitable due to a covered catastrophe, your renters insurance policy should cover the extra expenses that you may incur while being forced to live elsewhere.
Renters insurance and actual cash value (ACV):
ACV or actual cash value coverage pays out only for what your personal property was valued at when it was damaged or stolen.
Renters insurance replacement cost coverage:
Paying out what it costs to replace the items that you lost (due to damage or theft), minus the deductible, replacement cost coverage will cost you more in premiums, but will also pay out more if you ever need to file a claim.
If you haven’t yet protected your personal property with a renter’s insurance policy, it might be a good time to talk to a professional insurance agent
about the right kind of coverage for your circumstances, before it’s too late.