Renters insurance is a type of property insurance for people who rent or lease apartments, duplexes, mobile homes, or houses. A typical renter’s possessions are worth about $20,000, so having them insured is a good idea.
It is difficult for many people to decide whether to buy renters insurance for several reasons. A typical concern is whether their possessions are worth the extra cost or if an insurance company will cover them.
At Sandifer Insurance Agency, our experts will guide you through the process. We offer advice on renters insurance and recommend the right coverage for any situation. We provide free quotes for trustworthy insurance designed to fit each client’s unique needs.
Reasons to Buy Renters Insurance
You may think your possessions aren’t valuable, but could you comfortably replace them in the event of a fire, burglary, or other events? The purpose of renters insurance is to give you peace of mind that you won’t lose everything in an unforeseen event.
Renters insurance also provides protection in case of an accident at your rented residence. In the event that a guest falls and is injured while visiting you, renters insurance provides liability coverage to help with the associated medical bills.
Types of Renters Insurance
Similar to homeowner’s insurance, renters insurance offers two types of coverage:
- Actual Cash Value (ACV)
- Replacement Cost
ACV is the least expensive type of renters insurance. It pays what the property was worth at the time of the damage.
Replacement Cost pays the full amount of costs incurred to replace the insured items. This type of insurance is about 10% more expensive than ACV coverage.
As long as your budget allows, replacement cost coverage is your best option since it doesn’t consider depreciation of the insured items.
What Does Renters Insurance Cover?
The three basic components of renters insurance coverage include personal possessions, liability, and additional living expenses. Below are a few details about each of these components:
> Personal Possessions Coverage – Covers the contents in the rented dwelling that belong to you. The named perils covered include fire, theft, plumbing or electrical malfunctions, vandalism, and some weather-related damage.
A standard HO-4 policy for renters covers damage caused by aircraft or vehicles, volcanoes, vandalism, and others. Earthquakes and floods are not covered, but a separate policy for these perils is available.
> Liability Coverage – Liability coverage protects you in the event that someone sues you for an injury they incurred at your home. It pays for legal expenses up to the policy limit. The standard limits of liability range from $100,000 to $300,000.
> Additional Living Expenses Coverage – If your rental unit is damaged and becomes uninhabitable due to a covered peril, you are reimbursed for temporary housing. This coverage can include paying for hotels, meals, temporary rentals, or other living expenses incurred until your dwelling is being repaired.
What Is Not Covered?
Renters Insurance does not cover losses that are caused by negligence or intentional acts by the policyholder. Other items not covered by renters insurance include expensive, high-end fine jewelry, electronic equipment, antiques, art, or musical instruments.
You can purchase what is known as floater insurance to cover those items. It may also be a good idea to take out separate coverage for wind damage if you live in a hurricane-prone area.
Choosing Deductibles and Coverage Limits
You’ll find that a renters insurance policy is relatively inexpensive compared to homeowners insurance. According to the National Association of Insurance Commissioners (NAIC), renters insurance costs about $15 per month.
Of course, differences in rates vary between companies and between states. Your premium will also be determined by the amount of coverage you purchase and the amount of deductible you choose.
Sandifer Insurance Agency will help you determine the amount of coverage and deductible you need based on the value of your belongings.
An inexpensive renters insurance policy is an excellent way to protect your belongings. However, you may want to consider additional coverage for other unexpected events. The following types of protection are available to give you added peace of mind:
✔ Scheduled Personal Property Coverage – Protects specific valuables such as antiques, coin collections, musical instruments, and jewelry.
✔ Personal Umbrella Policy – Protects you if you’re found responsible for a liability judgment that exceeds the limit of your standard policy.
✔ Identity Theft Restoration – Pays lost wages and legal fees and other costs if your identity is stolen.
✔ Flood Insurance – Covers the cost of replacing your possessions if they are damaged by flooding. Remember, a standard policy does not cover damages caused by floodwater.
If you aren’t sure about whether to purchase these additional coverages, talk to Sandifer Insurance Agency to get expert advice.
Can Landlords Require Renters Insurance?
Yes, in most states, landlords are allowed to require renters insurance as a condition of leases. Oklahoma is the only exception. You may be asked by the landlord to provide proof of renters insurance. He can also require a minimum amount of coverage. Surprisingly, some landlords ask to be named as an insured on your policy.
Not all landlords require renters insurance, but you should consider it regardless. Keep in mind that more and more landlords are requiring tenants to carry insurance. Although the initial lease did not require it, the new lease may change.
Why do landlords require renters insurance? One reason is that it protects them from liability. These are some of the ways renters insurance helps landlords:
- Keeps them out of court in the event of a liability claim.
- Won’t have to pay to replace a tenant’s personal property if a natural disaster damages the items.
- Won’t be responsible for paying the tenant’s accommodations while the damaged property is being repaired.
- Keeps his insurance company happy as they may be pressuring him to require his tenants to carry renters insurance.
- Weeds out bad tenants. If they can’t afford renters insurance, they may not be able to afford the monthly rent either.
You don’t have to rent from a landlord who requires renters insurance. But, keep in mind that his insurance will not cover your possessions in the event of a fire or other catastrophe. So, it’s up to you to make sure your beloved personal property is protected.
Choosing the Best Company for Renters Insurance
You can begin your search for an insurance company by doing an internet search and comparing quotes. Another method is to ask family or friends who they recommend.
If you have automobile insurance, the company may also handle renters insurance. They may also offer discounts for package deals. Furthermore, some companies offer discounts for having fire extinguishers, fire or burglar alarms, sprinkler systems, and deadbolt locks. So, don’t forget to ask about these options.
For individuals in the Cheraw, SC area, Sandifer Insurance Agency can do all the legwork for you. Our team will pair you with the most appropriate company for your insurance needs.
After 40 years of working with the nation’s top insurance providers, we have the expertise to make sure you get the right coverage at an affordable rate. Contact Sandifer Insurance Agency today for renters, homeowners, commercial, automobile, life, or farm insurance quotes.
You are invited to stop by our office located at 113 Windsor Drive in Cheraw or contact us today by email, phone, or online.
- naic.org – NAIC Releases Report on Homeowners Insurance