It's no secret that in today's economy more people are renting. And since this is the case, you need to be sure that you have renters insurance to protect your personal belongings from fire, theft, vandalism and other occurrences. The purpose here is to give you a basic understanding of what renters insurance is and why it's an absolute necessity.
If you're reading this and thinking....
Why do I need renters insurance, I don't own that much?
The answer is simple. You do. Based on research data by the insurance industry, the average value of the contents of a typical 2 bedroom apartment is $30,000. Think about that for a second. Do you think you can afford to replace your belongings in case disaster struck?
Won't my landlords insurance cover me?
Absolutely not! The landlord has insurance to cover the structure and the land that it sits on. This does not include your personal property. That responsibility falls on your shoulders. A growing trend is that landlords are now requiring tenants to have renters insurance when the lease agreement is entered into. And actually, the landlord is doing the renter a favor. Most tenants never give renters insurance a second thought, until it is too late.
Another factor to consider is your liability in case someone injures themselves at your residence or damage is done to their personal property.
But… I don't need liability coverage, do I?
Here are the facts.
Your landlord's policy most likely does not include liability for something that happens in your rented residence. You could be held responsible for injury to another person or damage to another person's property if an incident occurred within your rented residence or elsewhere. Without liability coverage, you are the one who is liable for damages. Do you have the necessary funds to defend yourself in the event that you get sued? Most renters do not.
In the event that you are sued and you don't have liability as part of your renter’s insurance policy, what happens to your assets if a judgment is rendered against you?
Simple! A court may order them sold. What would you do if that happened to you?
Hopefully by now you understand the need to be insured. In today day and age it just makes good common sense.
But ...How Much Renters Insurance Do I Need?
Everyone's situation is different. But here are some simple steps to help you figure out just how much coverage that you need.
The first thing that you need to do is to start taking inventory of all of your personal belongings.
1. List every item that you now own. When you purchased it, the price you purchased it for and the current value. If you have receipts, start getting them organized.
2. If at all possible, take individuals photos of each item. Most of you have a camera on your phone. You can use that or ask a friend or family member if they have a camera that you can use. A photographic record makes it that much easier in the event that you have to file a claim.
3. After you have the list, total it up. Now you have a good idea of exactly what your personal belongings are worth. This also gives you a good idea on the amount of renters insurance that you should start to seek out.
4. Take this list, your photos...a good hint here is to put them on a CD and put it somewhere safe....AWAY from where you live. A safe deposit box is an excellent choice for this, although you may think of something better.
OK, now that you're convinced that you need renters insurance, let's take a look at some of the basics that you should have in a policy. Now the terms may vary from company to company but this is just an overview of the essentials.
1) Personal Property Coverage – this goes without saying but be sure that this coverage will also cover you and any of your personal property that you have when you are AWAY from your residence.
2) Additional Living Expenses – in the event that your residence becomes unlivable due to an insured loss, this part of a policy cover your expenses if you and your family have to reside elsewhere.
3) Personal Liability – since we already covered this, you should have a good understanding of the need to have this coverage.
Again, these are the basics. Just like with any type of insurance policy, you can elect to purchase more coverage based on your individual needs.
One tip to consider.....Although your personal property is covered for just about any type of catastrophe, MOST renters insurance will NOT cover damage that is caused by earthquakes or floods and in some regions you may also need to have additional coverage for hurricanes.
But...How affordable can this renters insurance be?
Actually, the majority of policies that are offered through the major companies break down to just pocket change a day. The question you really need to ask yourself again, is can you afford NOT to have renters insurance?
Are there any ways that I can save on renters insurance?
Absolutely! One of the biggest factors in most policies, after choosing your coverage, is the amount of the deductible that you choose. The higher the deductible the less your premiums will be.
Only buy the coverage that you need. If you need any type of special coverage, know the costs beforehand.
Install protective devices in your residence. Many insurance companies will now offer you a discount if you have smoke alarms, fire extinguishers and burglar systems installed.
If you currently have insurance, such as life insurance and car insurance, ask your agent what type of discount you can receive if you also purchase renters insurance.
What's the easiest way to shop for renters insurance?
The fastest and most convenient way, especially if you have a computer and an online connection is to shop online.
Since the insurance marketplace is highly competitive, virtually all major insurance companies now maintain a web presence.
The majority of these companies will also offer you a free quote based on your information that you provide them.
This allows you to compare multiple policies from the comfort of your own home before you have to make a buying decision on any renters insurance. So grab a cup of your favorite beverage and start the process of making sure your assets are protected.