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Need for Renters Insurance
If you do not own the place where you live, you need renters insurance. Renters insurance is like homeowners insurance – only it is for renters. This insurance will help you replace items that are damaged or stolen. The liability insurance included in the policy will help protect your assets and savings. Up to a point, renters insurance also helps pay for a place to stay if you have to move from your home due to damage from something like fire or hurricane.
First determine how much coverage you need. Total up the cost to replace everything you have. If you have a large amount of jewelry, art, or other items normally limited by the policy, you may want to purchase additional coverage (Personal Articles Floater) for these.
Renters insurance protects your personal effects from an assortment of perils that would most likely occur to those who rent, such as fire, wind, hail, lightening, theft, smoke, vehicles, aircraft, explosion, falling objects. As in all other homeowners policies, flood is not a covered peril, and you may want to consider purchasing a separate policy to protect your possessions from this type of damage.
Standard renters insurance policies pay actual cash value (ACV) for a loss. You should seriously consider paying the small amount of premium difference to purchase replacement cost. With replacement cost, rather than receiving the value of your items at the time of the loss, you will be paid the amount it actually costs to replace those items.
Another provision included in most policies is additional living expenses. This is coverage for your costs in excess of your “usual and normal” expenses in the event you have to temporarily move to another location while your home/apartment is being repaired; if it is unlivable. The typical coverage is based on a percentage of your chosen contents amount, and is limited to a reasonable time considered for rebuilding or relocating.
Other than just taking care of your “stuff”, renters insurance also protects tenants from some liability. For example, if someone trips and falls in your home/apartment, resulting in costly medical bills or even a lawsuit, your policy would cover you for this.
Like a lot of other types of insurance, renters policy premiums depend on varying factors such as where you live, your deductible, and any additional coverage you may purchase. Overall, the best part of renters insurance is that it is inexpensive; usually costing only a few hundred dollars annually. Isn’t peace of mind worth more than the price of a monthly delivery pizza?
