If you’re one of the millions of Americans that rents a home, condo or apartment its important to understand Renter's Insurance.  .If you don’t have a policy, you’ll want to really pay close attention to this post.
In its most basic form, renters insurance helps cover your personal belongings from fire, theft, vandalism and other losses as well as provides you with some basic liability coverage in the event you’re found liable for bodily injury or property damages.


There are also different types of renters insurance policies. A replacement cost policy will help pay for replacement of your items as if they were new. A nice thing considering that depreciated jeans, furniture and computers won’t help you become whole again.
A recent article from the Insurance Information Institute states that less than one-third of all renters (31%) have a renter’s insurance policy. Why is that? Do people assume that since they pay rent, their items are covered by that rent cost? Do they assume their landlord has insurance and it would cover this loss? Do they think maybe their auto insurance covers some items? The answer to this is that none of these items will likely cover any of your items. Only a renter’s insurance policy will.
There are 2 basic types of renters insurance:

1. Actual cost value: Pays to replace your damaged or stolen items up to your policy limits, less depreciation.
2. Replacement cost: Pays to replace your damaged or stolen items up to your policy limits with new ones, no depreciation.

Some additional things to consider is if you have expensive jewelry, musical equipment or collectibles that you want to insure. This may require a “floater” to be added to your policy.
One last item to ponder is how much liability you want to be covered for. You can get up to $500,000 in liability coverage. This will protect you from lawsuit. If you want even more coverage, you should consider a personal umbrella insurance policy. This goes above and beyond your renter’s limits to provide even more coverage.

Renters Insurance is very inexpensive and in most cases it will cost less than 50 cents per day.

If you’d like to learn more about renters insurance feel free to send us an e-mail or give us a quick call.  We can typically quote a renters policy in less than 5 minutes. 

We all pay for insurance and most of us just expect that claims will be paid when we file them. However, insurance is a legal contract and payments will be made according to the contract. Here are some common reasons claims might be denied:

1. The coverage was not accepted. If an agent offers coverage but the client declines it then that claim will be declined. Make sure to ask your agent about different coverage options being offered. Understand any coverage you want to decline thoroughly so that there are no surprises. This happens most often with things like Uninsured and Under-Insured Protection, Medical Payments, and things that might not seem important but raise the cost of insurance. Sometimes these options won’t show up on a quote or declaration page and it requires an agent to explain the details.
   
2. The policy is written that way. The declaration page or the quote does not tell the whole story. That’s why insurance policies are 30 – 50 pages long. A named perils policy will not cover things that an open perils policy will cover. The quote page looks the same, but the coverage is vastly different. Sometimes auto insurance is cheaper because a company puts in a “step down” provision that reduces coverage if a driver is not listed on the policy, like a friend or neighbor who borrows your car.
3. The limits are too low. If you bought your home 10 years ago and have never reviewed your policy it is likely that there is an “inflation protection” provision of 2%-4% to try to keep the limits high enough. However, these automatic increases are rarely correct after several years. A home that could be built for $150K ten years ago might have been upgraded over time so that now it might be $250K today to rebuild it. With a 2% inflation protector that policy will only pay $183K. Similarly, with car insurance, the greatest insurance company in the world is not going to pay more than the limits on the policy. If you buy state minimums, that is what you will get.
4. Business use on a personal policy. Things like delivering pizza or storing a backhoe in your detached garage might seem pretty minor. They are things that will invalidate your insurance and cause claims to be denied. Any business use of a separate structure makes that separate structure a business use exclusion to your personal home policy. Delivery is excluded on a personal auto policy. These are things you need to disclose to your agent to see if there is coverage available in some other way.

The lesson here is to find a knowledgeable agent who explains the coverages, not just the price and the deductible.