*By John Voket
I need a bunch of you – specifically you renters – to take a moment and consider an important piece of advice about your stuff. If you love it, then make an extra effort to protect it.
Did you know the majority of homeowners buy insurance, but just one in three college-aged renters insures their belongings? Even more shocking: at least half of all renters fail to buy any insurance protection for their possessions.
Way too many consumers are under the mistaken impression that their landlord’s policy will cover their losses, according to the Connecticut Better Business Bureau. BBB says renter’s insurance generally covers property damage or loss caused by theft, fire, vandalism or storms. In addition, most policies include liability coverage, which protects a tenant if someone gets hurt when visiting their home or apartment.
The cost of renter’s insurance is usually lower than homeowner’s insurance because it covers only personal property and liability, not the structure. The amount of the deductible can also affect the cost of premiums.
Two types of renter’s insurance coverage are available:
- Actual cash value insurance pays to replace items up to the policy’s limits, minus a deduction for depreciation.
- Replacement cost insurance pays the actual cost of replacing your possessions, regardless of depreciation, up to the limits on the policy.
Consider the value of possessions versus the cost of insurance – even a college student can have property worth several thousand dollars, such as computers, televisions, furniture, jewelry or small appliances.
When seeking a renter’s insurance quote:
- Determine if you have specific items of high value, you also may need a rider to cover those items.
- Ask what deductibles apply to the policy.
- Find out whether the policy will cover living costs if you are unable to occupy your current apartment or home.
- Inquire about exclusions, such as types of property that would not be covered.
- Ask the insurer if they give discounts for burglar alarms, fire extinguishers, sprinkler systems or deadbolts on exterior doors.
- If you are switching insurers, be sure that the new policy is in effect before dropping the old one.
- As with any insurance product, BBB advises consumers to get estimates from several companies before buying a policy.