What is Renters Insurance?
Are you a tenant? The house is insured, but what about your belongings? Does it bother you? Renters insurance is the answer to this! This is insurance, which protects the renter. It will cover the personal belongings of the tenant. Some types of insurance can also give coverage for injuries or property damage. Purchasing renters’ insurance is a smart thing to do. However, not many tenants go for it unless their landlord demands it.
Benefits of Renters Insurance
We know that this protects a renter, but let us take a closer look. Personal property of a tenant is not covered in case of theft, fire, damage, etc. under the landlord’s policy. So, what are the different benefits?
- You can get compensation for your belongings if they are lost or stolen, like a bike, laptop, etc.
- You can get protection against liability claims from any person who suffers injuries in your rental.
- It can cover your personal property like mobiles, laptops, etc. even if they are in some other location like a car or locker.
How Much Renters Insurance Is Good?
Renters Insurance is not very expensive. According to the Independent Insurance Agents and Brokers of America, Inc (IIABA), an average renters policy can cost about 12 dollars a month for an insurance cover of about 30000 dollars in personal property coverage. So for the cost of a few cups of coffee every month, you get perfect coverage! Here are a few pointers to help you find what your insurance needs are:
Do a Full Inventory of Your Possessions
Generally, personal property coverage covers damage up to a certain amount. It is essential to get the right value of your property. Completing an inventory will tell you how much property coverage you require. List your possessions with their cost price, age, and other relevant information.
Get Right Information From Insurance Agent
Insurance agents can offer discounts on specific plans. Ask the right questions and get as much information as possible. If you buy more than one policy like a bundle, then you may get a better offer. For example, you can bundle renters insurance with auto insurance or even life or travel insurance.
Choose The Correct Deductible Amount
A deductible is an amount that you pay out of your pocket. Suppose an accident like fire causes the damage of 2000 dollars! If your deductible is 500 dollars, then your insurer will pay 1500 dollars for the damage. Insurance premiums will be according to the deductibles. Lower deductibles will mean higher premiums, and higher deductibles will mean lower premiums.
Points to Remember
You should think carefully about how much you are willing and able to pay out of your pocket. Some people are financially disciplined and may have personal cash reserves, while for some, it could be a risk of higher expenses.
What is Your Liability?
Your renters’ policy liability coverage can protect you if there is an injury to someone in your home. There could be protection for you in case you or your family causes damage to the property. Some agents also offer policies that can help you in court cases. A renters insurance policy can offer around 100000 dollars in liability coverage. For most people, this is a good amount, but if you think you need more protection, then look for suitable liability coverage.
Add to the Coverage
All policies have specific exclusions. Some may not give coverage for natural calamities like earthquakes or floods. Or, there could be limited coverage on specific items and may not cover everything. If you think that your needs are different or you need to have better coverage. Talk to your agent and find out how you can supplement the coverage or add separate policies.
Location of Apartment
Where your house or apartment is located will play a big part in your renters’ insurance rates. There are many factors like city, neighborhood, type of home, etc. which are taken into account while calculating the coverage amount. Low-crime areas will have lower rates and can save you some money. Moreover, the condition and age of the building or property also play an essential part. Old buildings have a higher risk of electrical issues. Having smoke detectors and fire extinguishers can lower this risk factor.
Benefits for Landlords
Renters insurance is not only beneficial to the tenant but also the landlord.
Protection against damage
A tenant may sue the landlord if there is theft for failing to protect his property. Renter’s insurance coverage can cover this loss and stop tenants from suing.
If a tenant has renters insurance covering the cost of any damage to his personal property, then the claims will be less against the landlord’s policy.
Renter’s insurance policy might give a good indication of a tenant’s rent-paying potential.
After going through all the information, you will now have a better idea of how renters insurance you need. Look for more information and ask experts before you make a decision.