School is finally over. It is time to go out and look for your own new apartment. After an exhaustive search and a barrage of confusing paperwork, you are finally ready to move in to your first apartment. You have managed to furnish new home with everyday essentials and are eager to begin living in your own place for the very first time. But let’s slow up for a minute! There are other things you should be considering as you are moving into your new apartment. It is important that you consider buying renters insurance before getting too comfortable in your new place.
For little cost, renters insurance can help protect you from fire, smoke, vandalism, and theft-related losses. Imagine that you had to completely replace all of your belongings due to a fire, would you be able to afford that? There are two different ways you can insure your belongings on a renters insurance policy: actual cash value and replacement cost. Although replacement cost policies are a bit more expensive than actual cash policies, they help reimburse you for the full cost of replacing your belongings. An example of the differences would be: if you purchased a flat screen TV, and it was stolen while you are on vacation. Actual cash value replacement would give you money to replace the belonging by assigning a marketplace value to your TV and then subtract depreciation (for it is no longer new). If you had replacement cost the insurance company would replace your TV with one of like kind and quality to what you had before.
Your renters’ insurance policy also covers liability protection in the case that you are sued for bodily injury or property damage. Most first-time renters are not aware that if you invite someone in to your home and they get hurt or if you cause bodily injury or property damage to someone else, you could be liable to pay for their medical and/or pain and suffering expenses. For example – picture you had a party at your home on a Saturday night, which included alcohol. When your guests leave your home, they are intoxicated and get into a serious automobile accident. You could easily be sued for allowing your guests to leave your home intoxicated. This lawsuit could simply cost you hundreds of thousands of dollars.
According to the Insurance Information Institute (III), only 31% of renters have renters insurance. This low percentage is likely caused by the common misconception that landlord’s insurance covers damage to personal possessions. The truth is, your landlord’s policy probably covers only damage to the building and provides you no coverage your belongings or for liability coverage if you are sued. Renters insurance is also a good idea if you’re a college student living away from home. You should check to be sure that your belongings would be covered by your parents’ homeowner’s policy. Most homeowners policies have a small amount coverage for belongings off premise of your home. This amount might not be nearly enough coverage to place your belongings. Here are a few tips to keep in mind as you look into renters insurance:
- Make sure to keep a record of your belongings that may need to be replaced, such as a video or photo inventory. Make sure to store this in a safe place separate from your apartment.
- If you are living with a nonrelative, your roommate may not be covered by your policy and have to get a policy of their own.
- Be sure to also insure your jewelry or collectibles on your renters policy.
- If you carry auto insurance, purchasing renters insurance could provide you with a discount depending on the insurance company you go with.
Did you know that you can be reimbursed under some renters policies if you become a victim of identity theft? Or that your policy rate may be discounted if your rental property has a burglar alarm? We at Brownell insurance center are a great resource for coverage options and potential discounts under your renters’ policy. Once you find a policy that fits your needs, you’ll finally be ready to begin living in your new apartment — with a lot more peace of mind. Best of luck!
Information for this blog provided by Safeco Insurance.