The Importance of Renters Insurance
If you are thinking about renting a home, it is important to keep in mind how you might fare financially should an accident or some event happen that leads to loss in your new dwelling. By buying good renters insurance, you can keep the contents of your home protected while potentially saving money over the long term.
Renter’s coverage is for those who live in a dwelling that they do not own. If you own property that you rent out, the coverage you need is a landlord policy, not a renter’s policy.
How It Functions
This coverage is so important that many landlords require it. Renters insurance only covers personal belongings within the walls of your rented dwelling. The landlord usually will have a policy that covers the actual structure, but if an accident, fire, or person destroys any of your personal property, then only renters insurance will compensate you for lost or damaged items.
It is smart to think about the total dollar amount it would take to replace all of your belongings at once. Most renters certainly couldn’t find such an amount without breaking the bank and/or going into debt. Also, and quite vitally, a renter’s insurance policy can give coverage to you if someone were to hurt themselves while inside your place.
What It Covers
Normally a renter’s policy will cover losses resulting from such things as fire, theft, vandalism and a leaky pipe. However, it will likely exclude such natural disasters as floods, hurricanes and earthquakes. These events will usually need to be covered by separate policies and, depending on where you live, these additional coverage options could be important.
Types of Coverage
Renters coverage is pretty standard, though there are differences depending on the kind of home in which you live. The main variance in policies is the compensation choices. One type gives you the value of your personal property, minus depreciation. ‘Replacement value’ policies will normally be more expensive, but you will receive the amount it actually takes to replace your stolen or damaged belongings.
The major plus of a good renters insurance policy is the financial protection in the event of loss. An additional plus is that renters coverage is relatively affordable, yet very effective when needed. Life is so unpredictable. It just makes good sense to have proper insurance protection.