Why is Renters insurance necessary?

Living in a rental home or apartment without proper insurance can be a more significant liability than you think. Rentals properties are more likely to be burglarized than owner-occupied properties. With 60 percent of renters not having a renters policy, let's learn why renters insurance is necessary?

Why does it matter?

Suppose you rent a house or apartment and feel your landlord is the most incredible and financially responsible person you could find. If there is an event, please remember that your landlord may have insurance, but it is to protect the building, not your property.

As the repairs to the building are completed, it is important to note your rental agreement does not cover your personal property or living expenses. The only way to protect yourself against these startling events is to buy a renters insurance policy. Renters insurance covers your stuff, protects you against liability, and includes additional living expenses. We will outline these three types of coverage:

Personal Property

A standard renters' policy will cover replacing your personal property if you suffer a loss. The type of loss is essential because an insurance company will not cover any loss, so let's see a few included in your policy:

1. Fire or lightning

2. Windstorms and hail (in some states like Texas and Florida, this will be additional)

3. Theft

4. Vandalism or malicious mischief

5. Explosions

6. Weight of ice, snow, and sleet

7. Falling objects

8. Riots or civil commotion

9. Smoke

10. Damage from aircraft

11. Damage from vehicles

12. Volcanic eruption

13. Accidental water/steam overflow discharge

14. Cracking, burning, sudden and accidental tearing apart, or bulging of an appliance

15. Sudden and unexpected damage from artificially generated electrical current

16. Freezing

Before deciding how much insurance you need to buy, take a moment. You must know the value of all your property, including

1. furniture,

2. clothing,

3. electronics,

4. appliances,

5. kitchen utensils,

6. bedding.

The easiest way to figure out these things is by using our Property Calculator. Also, please take photos of the complete list of your items and their estimated value. Let's consider is which type of policy you want.

There are two types of renters insurance coverage for your Personal property:

• Actual Cash Value: This is a lower-cost option. An example is purchasing a sofa and loveseat for $5,000.00. You own it for five years before a small fire in the living room destroys it. In this scenario, nothing else you own is damaged. So you call your trust agent and file a claim. The insurance company determines the cost to replace your furniture is $6,000.00. The next step would be to determine what the depreciation is. It is 10% per year for furniture, so $3,000.00 is reduced from the total replacement value, and you will receive the difference of $3,000.00 minus any deductible.

• Replacement Cost: This is exactly how it sounds; the insurance company will determine the replacement cost of $6,000.00 and pay this amount minus the deductible.

It will be entirely up to you to decide which coverage to select, and the cost difference will be about 10% between the two policies. Still, it can be well worth the additional cost. You can also add a rider called scheduled personal property; this will cover an increased number of items in your home above your standard item.

Liability

Our renters' insurance policies also provide liability protection if you or members of your familiar cause injury to others or damage their property. It also pays for damage your pet may cause. Assuming you have a claim due to your dog biting a neighbor, your Liability Coverage within your policy will shield you against losses. Court costs, attorney fees, medical costs, and damages are covered up to the limit of your policy. The liability coverage starts at $100,000 and can go as high as one million dollars.

Additional Living Expenses

You may be pleasantly surprised to learn that Additional Living Expense coverage is included in a renters insurance policy. For example, the home or apartment you rent is damaged and unlivable; you need to live elsewhere until your place is restored. In that case, renters insurance will cover your additional living expenses, namely, your extra cost versus regular living expenses incurred by living away from your home, such as hotel bills, temporary rentals, restaurant meals, and other costs to commute.

Conclusion

Sometimes you may not have a choice; your landlord or building management may demand you purchase Renters Insurance. Still, even if they do not, a wise consideration would be to call CompareAquote or visit our website CompareAquote.com, and we will help you make an informed decision on which coverages you need and how much protection is suitable for you.