By Ron Leshnower, About.com Guide
Have you been wondering about whether you’ll be protected if your personal property gets damaged, or if someone injures herself in your apartment?
Read answers to commonly asked questions about renter’s insurance and why you should strongly consider purchasing it.
Q: Why do I need renter’s insurance?
A: You need renter’s insurance to cover you if any of your furniture, electronics, books, or other belongings get damaged or destroyed. Renter’s insurance also covers you in the event that someone else is injured in your apartment or someone’s personal property is damaged and sues you.
Q: Do I need renter’s insurance even if my landlord has insurance?
A: Yes, you need renter’s insurance even if your landlord has insurance. Although your landlord almost certainly has property and liability insurance, your landlord’s policy doesn’t cover the items that you keep inside your apartment, and it doesn’t protect you if a guest is injured and sues you for liability.
Q: Is a good renter’s insurance policy hard to find?
A: Not at all. Several top-name insurers, such as Allstate, Geico, and State Farm, offer renter’s insurance. If you already have insurance (for instance, for your car) with a company that you like, ask your agent or broker whether you can also get a renter’s insurance policy. Keep in mind that having more than one policy with the same insurer can save you money through a multi-line discount.
Q: What if I don’t have much personal property?
A: Renter’s insurance is still important even if you don’t have much personal property because of the liability component. Also, chances are your personal property is worth more than you think. If you don’t have much personal property to insure, then you can save money by choosing a lower policy limit.
Q: Do I need renter’s insurance if I rent a condo, coop, or house?
A: Yes. Renter’s insurance is important as long as you rent your home. It applies the same whether you rent an apartment, condo, coop, or house.
Q: Will I get enough money to replace my stuff if it gets damaged or destroyed?
A: That depends on whether you opt for an actual cash value (ACV) or replacement cost coverage policy. ACV coverage pays for the market value of your property at the moment before it was damaged. Replacement cost coverage pays you the full cost of getting a new item to replace the one that was destroyed.
As you would expect, replacement cost coverage is more expensive than ACV, but it’s usually worth it. For example, think about what would happen if your computer, television, or stereo system were destroyed. If you only had ACV coverage, you would probably run far short of what you would need to properly replace these expensive items.
Q: Will I get paid to cover expenses for temporary relocation?
A: Renter’s insurance normally covers your living expenses if you must temporarily relocate because of extensive damage to your apartment. This is something that you should confirm, however, with your agent or broker before settling on a policy.
Q: What happens to my renter’s insurance policy if I move?
A: If you purchase a renter’s insurance policy and then move to a different apartment, your policy shouldn’t be affected, at least if the move is within the same state. Inform your insurer of your upcoming move and provide your new address to ensure uninterrupted coverage.