A lot of renters make the mistake of relying on the landlord or property owner’s home insurance for coverage. While these insurance policies cover the actual building to a certain degree, they will not cover personal belongings stored in them. Some home insurance won’t even cover renters altogether. That is why a separate rental insurance policy is needed.
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Before you go ahead and start looking through plans and options, however, it is necessary to take the time to understand the basics. That is why we are going to talk about the basic things you need to know about renter’s insurance in this article.
Three Main Coverage Types
A good renter’s insurance policy offers three main coverage types. The first one is personal property coverage; as the name suggests, this is the coverage that will protect your personal belongings against theft, fire and other hazards. It is also the main component of a renter’s insurance policy, one that will significantly influence the premium you have to pay.
The second coverage type is liability coverage. In the event of a fire or other disaster, this portion of the renter’s insurance policy will cover any third-party liabilities you have to pay. No one expects to be responsible for an accident or a disaster, but having this coverage in place will keep you financially safe should the situation present itself.
Last but not least, we have living expenses coverage. This is an optional coverage that is included in the best insurance policies. The goal of this coverage is to make sure that you can continue living conveniently – either through renting another property or other temporary accommodation options – without straining your personal finances.
Coverage Amounts Matter
Renter’s insurance is something that can be customised to suit your specific needs and budget. You have complete control over how much coverage you want and the premium you’ll have to pay to get coverage.
The best approach is to set the coverage amounts correctly. Set it too high, and you won’t be able to utilise the insurance policy fully; the insurance company will only pay for the damaged goods, not the total sum of coverage. Set it too low, on the other hand, and you won’t be able to replace the damaged personal belongings.
When renting an apartment, make a list of all of the belongings you are moving to the new property and estimate the total value. This will help you set the right amount of coverage without hassle.
Premiums
It is interesting to note that renter’s insurance policies are very affordable. A suitable policy with sufficient coverage should cost no more than $200 to $300 per year. Naturally, you pay more to get more coverage. You can also choose to save on the premium with lower coverage options.
The fact that it is so affordable makes having a renter’s insurance policy a must. It is an excellent protection to have when you’re renting a property and you want to stop worrying about the financial risks associated with living in a rental house or apartment.