Renters Insurance Basics | Tenant Insurance Online
Renters Insurance Basics
Do I really need Renters insurance? The answer is absolutely yes – things happen when least expected, this is simply part of life. Your laptop gets stolen, someone slips and falls when hosting a get together, a fire causes damage to your apartment and you need a place to stay until repairs are made; each of these items would cause you financial hardship and Renters Insurance is designed to alleviate the pain. Whether an apartment, condo or house, the landlord will have insurance that protects the actual dwelling, but you are responsible if you, or a visitor get injured, or your personal property is damaged due to a number of causes. Most responsible Landlords in this day and age require Renters Insurance as a condition on the Lease Contract.
How much coverage do I need? In order to calculate how much insurance to buy, you must add up the cost of everything you own – bed, furniture, clothing, electronics, and dishes. The average renter in a one- bedroom apartment has about $20,000 worth of personal items; the average renter in a small three-bedroom house has about $50,000 worth of personal items.
What’s my landlord responsible for? Your landlord will have separate property insurance that could vary depending on the company they are insured with, but generally speaking that insurance policy only covers the building itself. Your landlord is not responsible for your personal property if it’s destroyed or stolen. That’s what a Renters insurance policy is for.
What’s covered? There are three components to a Renters policy: personal property, loss of use and liability.
- Personal property refers to your belongings. Your policy covers your belongings from things like power surges, fire, vandalism, theft and other events out of your control.
- Loss of Use covers the cost of the hotel, food and other expenses that you incur in case you can’t live in your apartment due to a covered event.
- Liability pays for bodily injury and property damage caused by your negligence, such as when your dog gets loose and bites the mailman, or your bathtub overflows and damages the apartment below.
How much does it cost? Price varies by state, liability limit, and the amount of personal property that you want to cover. A typical Renters insurance policy has a $30,000 limit for personal property, and a $100,000 limit for liability. The cost of a basic Renters insurance policy is $15-$30 per month. That’s a small price to pay for the peace of mind you’ll have knowing you’re covered.
There are several contributing factors that will impact the price of Renters insurance, including:
- Location – your zip code is an important factor in determining the cost of Renters insurance.
- Type of residence – the larger the building and number of units can determine the amount of your premium.
- In some states, your insurance score could also factor into the cost of insurance.
- Owning a dog could result in a higher rate.
- The amount of coverage that you select will determine what your rate is. A higher deductible means a lower rate.
How do you choose the right deductible? Your deductible is the amount of money that you would pay if you have a claim. That means if you have a $500 deductible and have a $3,000 claim, you would pay $500 and the insurance company would pay $2,500. When choosing your deductible, consider how much you can afford to pay out of pocket if you have a claim. Your deductible should never be higher than that amount, because if something happens, that’s the portion for which you will be responsible.
How to purchase a Renters Insurance Policy:
In some extraordinary situations, it may be necessary to reach out to one of our licensed representatives for advice regarding occupancy and coverage options. Our staff are always delighted to help!