Do You Need Apartment Renters Insurance?
Should You Buy Apartment Renters Insurance?
Is it important to buy apartment renters insurance? After all, your landlord already has apartment renters insurance coverage, right? Find out the facts about rental insurance that will keep you from making a costly mistake while giving you peace of mind at the same time.
What is Apartment Renters Insurance?
If you rent an apartment or home your landlord will undoubtedly have insurance that covers the building. But does this mean you don’t need apartment renters insurance or any other type of insurance protection? Renter’s insurance is a protection against loss of personal property for people renting homes or apartments. Your landlord may have insurance that covers the building itself, but this type of coverage will not reimburse you for personal items damaged, destroyed, or stolen. Many landlords will actually require their renters to purchase this insurance on their own to limit their liability.
There are a few things you should consider before purchasing apartment renters insurance. If you have very few personal belongings it may not be to your benefit to spend money on insurance. Your possessions may not be worth insuring. In addition, if you cannot afford the price of insurance you may not want to spend your precious money on protection. If you feel that it’s necessary to get protection you can choose to increase your deductible which will lower your premiums. It all comes down to how valuable your property is and whether it’s worth spending money to insure it against loss.
How Much Coverage Will You Need?
Once you have decided that home or apartment renters insurance is something you need, a few other items must be taken into consideration. First, how much coverage will be necessary? The more coverage you get, the more it will cost. For this reason you will need to calculate the cost of replacing the property that must be replaced if damaged or stolen, and not buy coverage that you do not really need.
As mentioned previously, you can usually lower the cost of apartment renters insurance substantially by raising your deductible. If you need apartment renters insurance, but can’t afford to pay very much toward the premiums, you can raise the deductible to lower your costs. This way you will still have coverage should a catastrophe occur, and this can give you peace of mind. If everything was destroyed or stolen you would still have to pay your deductible, but it would save you from a total loss of your property. And surprisingly enough, renter’s insurance can be cheaper than you think. It can often be as low as $20 per month or less.
Actual Cash Value or Total Replacement Coverage?
You will need to decide if you want coverage for the actual cash value or total replacement cost of your property. If you buy actual cash value coverage the payout will be the amount your property was worth at the time of loss. With this type of coverage you will typically not receive enough money to replace your belongings because the payout from the insurance company will be the cost of replacement minus depreciation.
The replacement coverage payout will reimburse you for the replacement cost. If you bought an item for $100, but it can only be replaced at a price of $200, replacement cost insurance will pay the actual replacement value of $200. This type of coverage will cost more than actual cash value coverage, but it is usually worth the small increase in price.
What Items Will Raise Your Rates?
There are some items that will raise your apartment renters insurance rates. Smoking will cause premiums to go up because many fires are the result of smoking. Owning a pet may also raise your rates because of the increased liability. Some breeds of dog will require higher premiums and some insurance companies may deny coverage of certain types of dog altogether. If someone is injured due to an accident you can be liable for damages. For this reason, liability coverage is pretty much standard in most renters insurance policies.
What Can You Do To Lower Your Rates?
There are several items that can lower your rental insurance. If you install devices such as smoke detectors, dead bolts on exterior doors, window locks, fire extinguishers, or other safety equipment, you will save money on your coverage.
Protect Yourself
To protect yourself it is wise to take an inventory of your personal property before purchasing apartment renters insurance or renters home insurance. You can’t simply write things down, you must use a better approach which is to either take photographs of your possessions or videotape them. Videotape is best because you can talk while videotaping your belongings, describing each item and how much you paid for it. You should also keep receipts for everything you buy and keep these receipts protected. It’s best to have original receipts and also copies in a separate location. If you can keep them in a fireproof safe or box it is even better.
