A Complete Guide to Renters Insurance

A Complete Guide to Renters Insurance pexels.com What is renters insurance? Costing about $10 to $20 a month, renters insurance protects renters against possible loss or damage to their personal property. It also insures renters in the case that someone else is injured while on their property. What does renters insurance cover? Renters insurance covers a wide variety of potentially disastrous things that could happen to your rental property and/or your belongings. According to Insure.com, a super helpful site explaining the basics of renters insurance, there are 16 different perils covered by a policy called the HO-4. Some of these perils include fire or lightning, explosions, windstorm or hail, damage caused by vehicles, smoke, falling objects, vandalism, and theft, just to name a few. For the complete list, visit Insure.com if you want to check all 16 conditions that are covered by renters insurance. What does it not cover? While renters insurance certainly covers many different perils that could befall your rental property, there are unfortunately some conditions that are not covered. For example, your insurance won’t cover such natural disasters as earthquakes, mudslides, and landslides. Further, events such as natural floods, war, nuclear hazards, government seizure of your property, intentional destruction of property, and failure to save your property either during or after the time of loss, are not covered by renters insurance. To get coverage for such events as earthquakes or floods, you may need to purchase a separate insurance policy. Also, be aware that even your pets can become a liability. For example, if you have a dog and it bites or injures someone  who is on your property, the harm caused will not be covered by your renters insurance policy. As a result, if you do happen to have a dog (or any other pets that could potentially cause harm to others), you might want to consider purchasing a separate policy that will cover animal bites. Infographic by Kailey Walters What are the benefits of having renters insurance? Have you ever heard of the saying, “Better safe than sorry”? Well, that saying definitely applies to your decision to get renters insurance. Some people might hold themselves back from buying renters insurance because they think it’s not worth it â€" perhaps they don’t feel like shelling out extra money each month, or they think their personal belongings aren’t valuable enough to warrant protection. However, at about only $10 to $20 a month, renters insurance is certainly affordable and a worthy investment to make to protect your property. In fact, the  National Association of Insurance Commissioners (NAIC)  reported that the average cost of a renters insurance policy was $187 annually in 2011 â€" not a bad price for protecting your most prized personal possessions, especially when considering how much more expensive it could potentially be to replace any lost or damaged items out of pocket. Ultimately, the actual cost of your policy depends on a number of other factors as well, such as where you live and the type of coverage you choose. Especially if you intend to rent the same property for an extended period of time, making sure that your property and personal belongings are protected against any possible damage is certainly a smart idea. In the event of a disaster or something unfortunate that happens unexpectedly, you will have peace of mind knowing that your belongings are insured. Particularly if you think you cannot afford to replace any lost or damaged belongings, having renters insurance is a safety net to cover replacement costs. Further, if someone happens to be injured while on your property, they could potentially bring up liability issues by suing you. Having renters insurance can consequently save you a lot of headache in terms of dealing with paperwork and a whole slew of unnecessary legal issues. Another advantage of having renters insurance is that it may possibly  cover additional living expenses. For example, if something happens to your rental property (i.e. one of the 16 perils mentioned previously) and you can no longer live there, your insurance may cover the costs of temporarily living elsewhere, which includes your food, and other expenses. Especially when you think about how much it would cost to temporarily stay in a hotel for even a few nights, or how anxiety-inducing it is to find a place to stay on such short notice, you’ll be glad that you have a renters insurance policy. To make sure of the details, check with your specific policy. Can you rely on the landlord to protect your possessions? Unfortunately, no. A common misconception held among renters is that their landlord’s insurance will cover their rental property and their belongings, which is why many renters ultimately choose not to purchase an insurance policy. However, the landlord does not have you covered in this situation. While your landlord’s insurance covers damage to the building and the grounds, it does not cover your personal possessions or any damage you may have caused to your property, such as a fire in your own kitchen. With that being said, it is definitely smart to stay informed about what your landlord can and can’t do for you, and to know exactly what you are responsible for protecting. As a result, having your own renters insurance can be quite useful in protecting your property and in allowing you to know what to expect, so that you arent hit with any nasty legal surprises. In fact, some landlords might even require you to have your own renters insurance policy. If you are not sure about this or need assistance finding coverage, ask your landlord for some guidance. He or she should be willing to help you out and clear up any questions. What are the different ways that your belongings can be covered? There are two ways your belongings can be covered generally: actual cost value (ACV) or replacement cost coverage. ACV coverage will only pay for what your property was worth at the time of loss or damage, minus the deductible. This means, for example, that if you bought an electronic device for a certain amount of money ten years ago, ACV coverage will only pay for what it was worth back then â€" even though today, that electronic device would most likely be worth less. The other option, replacement cost coverage, will reimburse you for what the item costs according to current market prices, minus the deductible. While this option costs a bit more than ACV coverage up front, it may be more worthwhile in the long run, especially for more expensive items that you own. So, when it comes to how you want your belongings to be covered, you have a couple of options to choose from.  Again, definitely check with your specific policy to make sure of the details. What kinds of coverage are involved in renters insurance policies? There are three basic kinds of coverage to consider when you start shopping for a renters insurance policy: personal property, liability, and additional riders. Personal property coverage is fairly self-explanatory â€" it covers your personal possessions, such as clothing, furniture, etc., which is usually a minimum of $2,500 worth of coverage. Liability insurance protects you against liability claims, such as lawsuits for bodily injury, while additional riders provide coverage for belongings that are of higher value, such as jewelry and electronics. Where should you get renters insurance from? According to Value Penguin, some of the best renters insurance companies of 2018 include State Farm, Erie, Allstate, Lemonade, and USAA. So, if you want to get the most bang for your buck and rest assured that you are being covered by an effective policy, take a look at these companies. What’s more, Uloop is certainly a great resource to turn to for your renters insurance needs while still in college. Under the “Renters Insurance” section of Uloop, you will find a form that you can fill out to get a quote for renters insurance. You will also find information on the GradGuard College Renters Insurance Plan, which provides a number of useful features â€" such as theft and fire protection, or liability protection â€" that can be of great help in protecting your personal belongings and your property on campus. pexels.com What else should you do to be smart about renters insurance? Definitely one thing you should do is to take a complete inventory of all of your valuable personal belongings. Doing so will help you keep track of everything valuable you own and ensure that you are properly compensated for anything that is lost or damaged. Create a list of all your belongings and their monetary value, and make sure to keep the list in a safe place.  (It’s up to you whether you keep an electronic or a physical version do whatever works best for you!) It’s also a smart idea to keep receipts for everything, as well as to take pictures of your belongings and keep them as your own photographic records. Leave no stone unturned â€" after all, when it comes to your belongings, you want to do everything you can to make sure your stuff stays protected. Even if youre not a particularly organized person, there are a number of resources out there to help you stay on track with cataloging your stuff. One resource is the myHOME Scr.APP.book set up by the NAIC, which allows you to photograph images, barcodes, and serial numbers that you can then store electronically. Another good resource is the Allstate Digital Locker app, which also allows you to take and store photos of your belongings. Also, while this may seem a bit tedious, it’s a good idea to go through your policy with a fine-tooth comb to check for any limitations or specific items that are not covered. For example, many policies may not fully reimburse you for particularly expensive items such as jewelry and electronics. In those cases, say if you have a favorite piece of costly jewelry or a flat screen TV that you cant stand the thought of losing, you may want to consider getting further coverage beyond what the standard policy can offer, just to be safe. How can you save money on renters insurance? Although renters insurance is already fairly affordable, there are still ways you can get discounts on your insurance policies. If you have another policy (e.g. car insurance) with a certain insurance company, they might offer you a discount on your renters insurance. According to the Insurance Information Institute, you might also be eligible for a discount if you have a security system, use smoke detectors, use deadbolt locks, have good credit, stay with the same insurer, or are over 55 years old. Ultimately, if you rent property, it’s definitely a good idea to take the necessary steps to insure yourself against possible damage or loss of your personal belongings. When it comes to your possessions, you’ll want to make the most responsible decisions to ensure that everything you own and your property remain safe and sound!