If you rent your home or apartment, you need renter’s insurance to protect yourself and your possessions. Many renters wrongly assume that their landlords carry insurance that will replace the items in the home or apartment in the event of a disaster, but for the most part this is not the case.
While landlords do indeed carry insurance on the properties they own, that insurance covers the physical structure itself, not the items contained within each individual apartment. If the apartment building burns down, suffers flooding or falls victim to some other natural disaster, you will not be able to rely on the landlord’s insurance to protect your belongings.
Renter’s insurance is designed to fill in the gap between the coverage the landlord has for the building and your own individual needs. Renter’s insurance is generally very inexpensive, so there is no excuse for not carrying it.
Do Your Homework
If you are in the market for renter’s insurance, you need to make sure you are getting the best deal for your money and that you have the coverage you think you do. As with any type of insurance purchase, you need to do your own due diligence and research your coverage options carefully.
One of the most important things to look at when choosing a policy is the extent of your coverage. Some policies will pay the actual cost of items that are damaged or stolen, while others provide full replacement cost.
That distinction can be very important, especially if you own a lot of electronics and computer equipment. Items like televisions, laptops and tablets can depreciate quite rapidly, and that $1,000 flat-screen TV you bought a few years ago might only fetch $200 in today’s market. If you opt for actual value coverage, you could be out $800 when it comes time to replace a lost television.
Renter’s insurance pays for more than just the items inside your apartment. If you are displaced due to a fire or other natural disaster, your renter’s insurance policy may pay part or all of your living expenses.
The policy may reimburse you for the cost of a hotel room or pay for the cost of moving to another apartment. It is important to read the policy carefully and understand exactly which living expenses are, and are not, covered.
In addition to paying for living expenses and reimbursing you for lost items, your renter’s insurance policy has another important feature. Renter’s insurance also provides liability insurance if someone is injured on your property. This liability insurance is similar to the coverage provided under homeowners’ insurance policies.
As with property reimbursement and living expenses, it is important to understand the limitations of your liability coverage. You need to know how much coverage the policy provides and under what circumstances you will be covered. If the policy does not provide enough protection, you may be able to increase your liability limits to get the protection you need.
Renter’s insurance is an important purchase, and not one to be taken lightly. Taking the time to understand your coverage and read the fine print carefully is the best way to make sure you have the protection you need.