Did you know there are 74% more renters today than there were in 1960? That makes renters insurance a big business. Renters are often told by friends and family to “get some renters insurance”. Strangely enough, those same people are often unable to explain exactly why you need it or what it is.
Why Do I Need Renters Insurance?
If you are thinking that your personal property is insured under your landlord’s insurance, guess again. As a renter, you are responsible for your personal property, liable for accidents that may occur in your unit, or expenses that you may incur due to not being able to use your unit. A landlord’s insurance will normally only cover their building and possibly the unit you live in.
What Types of Things Are Covered by Renters Insurance?
A rental insurance policy can, but does not always, cover the following:
- Replacement costs for your personal property, such as household items, in the event that they are damaged, destroyed, or stolen;
- The liability you may face due to an accident in your residence. For example, if a guest is seriously injured while visiting you, your insurance may cover their medical bills or lost wages;
- If you can not live in your home due to an unforeseen event that is covered by your insurance, often your rental insurance will cover those expenses.
What Should I Look for When Purchasing an Insurance Policy? What Questions Should I Ask?
Because all insurance policies are a bit different, it is important to do your due diligence before you buy an insurance policy:
- read it, including the small print;
- have your insurance agent go over anything you don’t understand;
- ask what the deductible is (the amount you will pay before the insurance kicks in); and
- confirm exactly what is covered and what is not.
You should also keep in mind any special circumstances you may have. Just a few examples of questions you might want to ask are:
- I have a roommate, are they covered?
- What about my dog or cat?
- What does the policy say about water damage?
- Am I covered if there is a theft or fire?
These are all questions you can ask your insurance agent if they apply to you. If you have personal items that are valuable, such as expensive jewelry or art, you also may want to ask about whether these items are covered by your rental insurance policy, or if they should be insured separately.