Renters Insurance Guide

Many people think their landlords insurance will cover them if their possessions are stolen or damaged. Not so. Your landlord's insurance only covers the building you live in, not your possessions. If you want to protect your possessions you need to get renters insurance.

Renters insurance is one of the least expensive types of insurance, yet it provides invaluable protection for you and your possessions. Renters insurance covers three basic categories:

Personal Property

Personal property coverage pays to replace your possessions if they're stolen, or damaged by vandalism, fire, smoke, lightning, explosions, windstorms, burst water pipes, or electrical malfunctions.

There are two types of personal property coverages available:

Actual cash value coverage - which pays to replace your personal property minus a deduction for deprecation.

Replacement cost coverage - which pays to replace your personal property with no depreciation deduction.

Standard policies only provide limited coverage for expensive items like jewelry, furs, silver, and collections, so you may need to purchase additional coverage for these items. Standard policies also do not cover damage caused by floods or earthquakes, so if you want coverage for these disasters you'll need to purchase additional insurance.

Additional Living Expenses

This coverage pays for your living expenses - hotel, motel, and restaurant bills - if your home becomes uninhabitable due to the causes mentioned above. Most insurers will reimburse you for the difference between your additional living expenses and your usual living expenses.

Personal Liability

Personal liability coverage pays for another person's medical expenses if you, a family member, or your pet injures that person. It also covers damages to that person's property. Some policies do not cover pets such as as pit bulls or rottweilers.

Standard policies usually come with $100,000 to $300,000 worth of liability coverage, but you can purchase more if you have a lot of assets you want to protect from a lawsuit.

Cheap Renters Insurance

Cheap renters insurance is a great product to look into for the person who is currently renting a space. Cheap renter insurance will cover all of a person's belongings in case of a fire, burst water pipes, or burglary. But many insurance companies require an endorsement for the applicant who wants to insure his possessions. This includes claims on "acts of God," like floods and earthquakes. Many people have the common misconception that their roommate's or landlord's policy will cover their belongings. But this is not true. Each person must cover his own belongings. This type of protection will also protect the renter from medical bills should someone gets injured in his apartment.

These policy rates are simple to obtain. The driver who already has an auto policy can contact an agent for quotes on a policy for his personal belongings. There are also several cheap renters insurance rates listed online. As with any quote, be sure to shop around to find the most coverage at the best price. Here are some crucial points to consider when looking for cheap renters insurance. The replacement cost of belongings should be comparable to the actual value to replace them. A cheap renter insurance policy will reimburse the policy holder for actual cash value of the belongings.

In a nutshell, a policy holder should get paid for an item based on depreciation. If he owns several high priced electronics, he should consider replacement costs into his policy. With full replacement costs, the insurance company is required to pay the holder what it would cost to purchase the item at current prices. Some cheap renter insurance companies will ask the customer to take inventory of the items in his home first. The applicant makes a list of all of the items of any value in his home. He should include serial numbers, model numbers, and cost. This will help him to select the amount of coverage he needs for all these items.