6 Important Reasons to Get Renter's Insurance

6 Important Reasons to Get Renter's Insurance
You'll need insurance coverage to cover your valuables if you're renting an apartment or a house. Whether you live in an apartment, a house, or a duplex, your landlord's property insurance coverage covers losses to the structure. However, only a renter's insurance policy, which you must find and pay for, covers your personal belongings and certain obligations. Only 41% of renters carry renter's insurance, although 95% of homeowners have it.

Why are there so few tenants with insurance? Many people mistakenly believe they are covered by their landlord's insurance. Another explanation is that people undervalue their possessions. It wouldn't take long to go into the hundreds of dollars if you added up the value of only your wardrobe and devices.

Another issue that is sometimes neglected is liability: If someone is wounded in your home—a friend, neighbour, or the pizza delivery person—they may sue you. Even if you didn't think you needed insurance, here are six compelling reasons to do so.

1. It is within your financial means
According to the National Association of Insurance Commissioners, the typical renter's insurance coverage cost $180 per year in 2017 (latest data) (NAIC). The quantity of coverage you need, the type of coverage you choose, the amount of your deductible, and where you live will all affect your final cost.

2. Personal Property Losses are covered
Clothing, jewellery, baggage, computers, furniture, and electronics are all covered by a renter's insurance policy. Even if you don't have much, it can soon build up to a lot more than you know; and a lot more than you'd want to pay to replace it all.
A surprising number of risks are covered by the renter's insurance coverage. For example, a normal HO-4 policy for renters covers personal property losses caused by dangers such as:

1. Aircraft-related damages
2. Automobile-related damage
3. Explosion
4. Falling Items 
5. Lightening or fire
6. Civil unrest or riot
7. Smokes
8. Theft
9. Vandalism or malicious mischief
10. Eruption of a volcano
11. Weight of Ice, snow, or sleet.
12. Hail or windstorm
13. Water or steam damage can occur from a variety of sources, including domestic appliances, plumbing, heating, air conditioning, or fire-fighting sprinkler systems.

Standard insurance policies do not cover losses caused by floods or earthquakes. These occurrences necessitate a separate policy or rider. Additionally, in hurricane-prone areas, a separate rider may be required to cover wind damage. Furthermore, a renter's insurance coverage does not cover losses caused by your carelessness or willful actions. For example, if you fall asleep with a lighted cigarette and set fire to your house, your insurance policy is unlikely to pay the costs.

3. It might be required by your landlord
The structure and grounds are covered by your landlord's insurance, but your possessions are not. A growing number of landlords are requiring tenants to have their own renter's insurance coverage and will demand proof.

This could be the landlord's notion of an "order" from his insurance company. The notion is that by insuring the tenants, the landlord may delegate some of the obligations. Your landlord might be able to assist you with locating or securing insurance.

4. It protects you from legal liability
Standard renter's insurance packages contain liability protection as well. This protects you if someone gets hurt in your house or if you (or another covered person) injure someone by accident. Up to the policy amount, it compensates for any court judgements and legal expenditures.

5. Your Personal Property Is Protected When Taking a Vacation
Your items are covered by renter's insurance whether they are at your home, automobile, or with you while travelling. Your belongings are protected against theft and other covered damages no matter where you go around the world. For further information on what defines "other covered losses," check your policy or ask your insurance agent.

6. Additional Living Expenses may be covered
Your renter's insurance policy may cover "extra living expenditures," such as the cost of temporarily living somewhere else, food, and more if your property becomes uninhabitable due to one of the insured risks. Check your insurance to see how long it will cover extra living expenses and if it has a limit on how much the business will payout.

The Bottom Line
Renter's insurance protects your goods when you're away from home, in your car, or on vacation. Furthermore, renter's insurance provides liability coverage if someone is injured in your house or if you inadvertently injure someone.

Make sure you know what your policy covers, and inquire about discounts, deductibles, and coverage limits with your representative. Make sure you understand whether your property insurance provides replacement cost coverage (RCC) or actual cash value coverage (ACV).

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