If you are thinking about renting a home or apartment and don’t know much about renter’s insurance, we've compiled a few facts about renter's policies so you can be informed before you buy.
What does renter's insurance cover?
Renter's insurance covers your personal property in your rented home and will even cover a certain percentage of your personal property even if it's not in your home. It also covers personal liability, fire liability and medical payments. Personal liability is basically a coverage for when you cause harm to someone, or damage their property, and they sue you. There are some exclusions depending on the policy you purchase. Fire liability is to protect you if you were to cause a fire that damages the home or apartment you are renting. This pays your landlord for the damages instead of them coming after your personal assets or even garnishing your wages. Medical payments cover medical costs if someone were to get hurt while in your house.
It’s not expensive!
The average renter’s insurance policy that we write is between $100 - $200 a year! It's really not that costly when you consider you are covering your personal property and liability as well.
It's most likely required
A lot of people used to rent homes or apartments and not even think about purchasing renter’s insurance… Not anymore! More and more landlords are requiring you to buy a renter’s policy simply for the liability portion of the policy. Why? Like we discussed before... If you cause damage or do something that results in a lawsuit, it will help you and the landlord pay for the damages if you have a policy.
More about replacement cost
We have talked about replacement cost a couple times in past blogs, but it is just as important on a renter’s policy. When you insure your personal property at replacement cost, you are pretty much guaranteeing that you property will be replaced at the value that you purchased it at or higher. If you don’t have replacement cost you will get reimbursed based on actual cash value or depreciated cost. That means that $40 pair of jeans you bought could only be worth $5, and that is what the insurance company will give you. So when you purchase a renter’s insurance policy, make sure you buy replacement cost on your personal property. It’s not that expensive to add and it is well worth it!
Hopefully these 4 facts will better prepare you for purchasing a renter’s policy. If you have any more questions, always feel free to email us or message us on Facebook!