A Must Have - Getting Renter's Insurance

Information about renter's insurance including what is covered and what isn't and tips on what types of renter's insurance are out there.

Of all of the different types of insurance that are available to the consumer, renter’s insurance is probably the least understood and the least utilized. Renters insurance is just as important as home owner’s insurance, maybe even more so because as a renter you are not only liable for your own losses but you may, under certain circumstances, be liable for the losses or damage to your landlord’s property as well.

The world of renter’s insurance is not complex but it does require a little homework to understand what will fit your needs best. For example you can insure your property either for the actual cash value of your property or the replacement value of your property. If you opt for the actual cash value this means your policy will only pay you for the actual cash value of your property at the time it was damaged or destroyed. So if you bought an Apple Ipad last year for $500 your policy would give you what it is deemed worth now, a year later. That amount might be based on just about any calculation including what the going rate for an Ipad is used in good shape and in poor shape and your replacement price may fall somewhere in the middle of those extremes.

If you opt for the replacement value, your policy will give you the money to replace what it would cost for that item today and considering the price of Ipad is not going down, you may actually come out ahead this way.

Obviously the replacement cost option will cost you more in premiums than the actual cash value option but you have to ask yourself in a worst case scenario do you want to be able to replace your things or settle for finding the used equivalency?
You also need to know what is covered under your policy. Some events that are considered an act of God such as floods or hurricanes for example are not covered under a general policy. In order to have coverage for this unlikely event, you will need a whole separate rider added to your policy. Other things are included in most policies however including fire, theft, vandalism and even some more unlikely events such as civil riots and volcanic eruptions.

Finally you need to compile a complete inventory list of your property. And they say a picture is worth a thousand words so make use of your digital camera to inventory your home. You can take digital shots of all of your property and burn it on a cd to keep in your safe deposit box along with a list of serial numbers and original receipts. Don’t forget to include your digital camera on your inventory list.

And don’t forget to keep your list up to date. As you buy, sell or trade things, make sure your inventory list reflects the changes in your possessions so you can get the most out of your policy, if you ever actually need to.

Article Tags: Cash Value, Inventory List

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