Renters Insurance Basics: What Does it Protect?

Many people who rent never think about renters insurance. But as a renter, it is your responsibility to insure your assets in the case of a fire or bulgary - especially since a landlord or property owner is not responsible to cover your personal items. The only way to protect your personal items is to purchase a renters insurance plan. Here are some basics about this type of plan including what does it cover and why you need it today.

What Events Does Renters Insurance Cover?

For an amount as low as $20 a month (check with your local insurance provider for current rates) you can protect your items such as your computer, television or clothes in case they are damaged. Some reasons for damage may include:

  • Electrical Damage
  • Explosion
  • Falling Objects
  • Fire
  • Riots and Civil Commotion
  • Theft
  • Vandalism
  • Vehicles and Aircraft
  • Water Damage
  • Weather Damage

Additional Coverage Options:

Personal property coverage: This includes your personal possessions such as expensive jewelry, clothing, furniture, electronic equipment etc

Additional living expenses: This includes what you have to pay to live elsewhere if your rented home becomes uninhabitable, say due to fire, ongoing theft or vandalism

Personal liability: This covers a third party should they get injuired in your property, and hold you responsible.

Hurricane and flood damage may not be covered. You must check this detail carefully before signing.

Insurance policies are like motor cars. Everyone is different and prices vary, too. As a general rule if you buy cheap then cheap is what you'll get, usually in the form of high payments and drawn-out settlement terms. It can also be a false economy to go direct instead of using a good broker. That’s because a good broker should not cost you anything extra, and will fight hard for you if you have a renter’s insurance claim.

You must also always read the small print carefully. Study the policy before you sign it and ask your insurance agent numerous questions. You never want to sign something you don't understand and insurance policies can often be a bit confusing for the first-time buyer.