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Who Needs Renter's Insurance and What Does It Cover?

Who Needs Renter's Insurance and What Does It Cover?

Many renters don’t think that they need insurance. After all, the landlord is responsible for insuring the building. While that’s true, I want you to know that the landlord’s policy doesn’t cover your belongings inside of it. If there’s a fire, their insurance would only pay for repairs to the building structure, but it wouldn’t compensate you for the loss of your personal belongings. That’s where renter’s insurance comes into play. It also protects you in case of theft, and it includes a liability portion.

Replace Your Belongings

The most important reason to get renters insurance is to replace your belongings in case of fire, vandalism or theft. But this policy also kicks in if your belongings are damaged due to your landlord’s negligence. If a corroded water pipe causes a flood in your apartment, the landlord’s policy would only cover the structural repairs. Your insurance is there to pay for the ruined rugs and furniture.

Renters insurance isn’t limited to the belongings inside of your home. It will typically also cover the things you store inside your car. While it won’t cover damage to your car, it can help you replace stolen valuables. I can even offer you a policy that covers your belongings while you’re traveling. This can be helpful, because most airlines only cover you up to a certain amount.

You Have More Than You Think

The most common excuse I hear from people who don’t have renters insurance is the fact that they don’t really own a lot of stuff. Therefore, it doesn’t seem worth the effort to insure it. In truth, most people have more than $20,000 worth of belongings without realizing it. In fact, normal coverage amounts fall between $25,000 and $50,000, although there are plenty of people who need more than that.

This is not surprising when you think about all the things you have, including beds, furniture, clothes, tools, kitchen gadgets, electronic equipment and other personal items. This amount doesn’t even include jewelry or antiques, which I would include in a separate policy for adequate protection. I also recommend choosing a replacement value policy instead of an actual cash value policy. With replacement coverage, you get enough money to buy the same kind of couch you had. With actual cash value, you get reimbursed for the current value of your used couch, which is only a fraction of its replacement cost.

Liability Insurance

One part of renters insurance that most people don’t really know about is the liability portion. If someone got hurt in your apartment or rented home, you might be legally responsible to pay their medical expenses. If they file a lawsuit against you, these costs can quickly skyrocket, because litigation costs can be outrageous. Even if you don’t think you’d miss any of your worldly belongings, I recommend having liability coverage in place to prevent someone from going after your personal assets. Incidentally, liability insurance also protects you if you accidentally leave the water running and flood your neighbor’s apartment.

If you own a home, then you have the same protection with your homeowner’s insurance. For everyone else, I recommend purchasing a renters insurance policy. The premiums are very reasonable, especially if you opt for basic coverage. However, to make sure that nothing is left out, you should specifically ask to include any valuable jewelry or antiques you own. Please use my contact form on the website to request an insurance quote or call me directly. If you live in Visalia, Tulare, Selma, Hanford, Fresno, or surrounding areas, I’m happy to help you with all your insurance needs. I’ll create a personalized policy for you that covers everything you need and nothing you don’t.