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Renter’s Insurance Frequently Asked Questions (FAQ)
As you compare renter’s insurance policies, it’s important to understand how this coverage works and what you should look for. This FAQ goes over the most common questions and answers that can help you wind up with a renter’s insurance policy that adequately protects your personal belongings for a price you can afford.
How does renter’s insurance work?
Renter’s insurance is a type of insurance that kicks in to repair or replace your belongings in the event of damage or theft. This insurance is available for renters because it doesn’t cover the building you live in, only your personal property and other policy inclusions that come with your plan.
Like other types of insurance, renter’s insurance comes with policy limits that cap how much you can receive when you file a claim. Renter’s insurance also comes with a deductible you need to satisfy before your coverage kicks in.
What is the difference between renter’s insurance and homeowners insurance?
Where homeowners insurance covers someone’s home and their personal property, along with liability, renter’s insurance doesn’t cover the building you live in. You buy renter’s insurance in order to provide coverage for your personal belongings that might be damaged or stolen over time, but your landlord will buy a landlord’s policy that insures the building you call home.
Why you should seriously consider renter’s insurance
If you don’t have renter’s insurance in place and your rental is burglarized or your personal property is damaged or ruined based on a covered event, you will bear the full brunt of the costs when it comes to repairing or replacing your belongings.
Remember that your landlord only purchases landlord’s insurance that will repair or replace the building you live in, but they don’t provide coverage for your stuff. If you don’t buy renter’s insurance, you’ll be out of luck and left to replace all your items on your own.
What does renter’s insurance cover?
Renter’s insurance policies often come with different inclusions and exclusions, so you’ll want to make sure any policy you’re considering is comprehensive enough for your needs. With that being said, most renter’s insurance policies cover losses like:
- Fire, including fire from lightning
- Windstorm and hail
- Damage from explosions
- Damage by an aircraft of another person’s vehicle
- Smoke damage to your personal belongings
- Vandalism and theft
- Volcanic eruptions
- Damage or injury from falling objects
- Damage from snow, ice, sleet
- Damage from steam-heating/water-heating appliances/systems
- Leakage or overflow of water or steam in your building
- Short-circuit damage caused by refrigerators, stoves, and other appliances
Most renter’s insurance policies also include liability coverage, which can kick in to cover losses if someone is injured. Medical payments coverage is also typically included in case you need medical coverage for anyone injured in your apartment or rental.
Loss of use coverage is another important component of any renter’s insurance policy you should look for. This type of coverage will cover the cost of a new place to live, meals, and other unplanned expenses when your rental home or apartment becomes unlivable.
What does renter’s insurance typically exclude?
While policies definitely vary, most renter’s insurance policies exclude damage from natural disasters and some items of high value like art or jewelry. Many renter’s insurance policies do let you buy extra insurance for eligible high-ticket items, however.
Other exclusions you might see with a renter’s insurance policy include damages from terrorism or war.
Why is renter’s insurance so inexpensive?
As you compare renter’s insurance quotes, you may be wondering how it can be so cheap. After all, it’s not uncommon to secure a reasonable amount of renter’s insurance for less than $20 per month.
Renter’s insurance is inexpensive based on the fact you’re only insuring your personal belongings and not the building you live in. Homeowners insurance, which needs to have higher limits since it might be needed to rebuild a home from the ground up, is a lot more expensive for that reason.
How do I get the best price on renter’s insurance?
To find the best price on renter’s insurance, there are several steps you can take right away. Consider these tips as you search for the best deal:
- Compare renter’s insurance quotes from at least three companies. Shopping around and comparing renter’s insurance policies with at least three companies is the best way to secure coverage with lower premiums. Make sure that you’re doing an apples-to-apples comparison that keeps coverage limits, inclusions, and your annual deductible in mind.
- Consider bundling more than one policy with a single provider. Many insurance companies offer big discounts to consumers who sign up for more than one policy with them. In other words, you can often save big if you bundle your renter’s insurance with another type of coverage like auto insurance or life insurance.
- Choose a policy with a higher deductible. When you file a claim with your renter’s insurance company, you’ll need to pay your deductible before coverage kicks in. Choosing a policy with a higher deductible lowers liability somewhat for insurance companies, which lets them pass on some savings in the form of lower premiums.
- Select a policy with lower coverage limits. Also, make sure you’re not overpaying for renter’s insurance with high limits you don’t even need. If you don’t have a lot of expensive belongings and you mostly want some protection against damage or theft, choosing a renter’s insurance policy with lower coverage limits can help you save.
- Pay your premiums once per year. You may also be able to qualify for a discount if you pay your premiums once per year instead of on a monthly basis, so make sure to check.
- Make your rental or apartment more secure. Some renter’s insurance providers offer additional discounts for apartments that are made more secure with security systems, fire alarms, and more.
- Sign up for paperless billing. Sign up for paperless billing instead of opting to receive bills in the mail. You’ll save trees and waste this way, but you might also score a small discount for choosing this option.
- Choose auto-pay. Some companies who offer renter’s insurance also extend discounts to consumers who sign up for automatic payments using a credit card, a debit card, or an automatic bank draft. Not only can you score a discount with this strategy, but you’ll never forget to pay your bill.