If you rent a home or another space, Renters Insurance is an important piece of the equation, providing protection for both your belongings and the liability of the rental property owner. Many property managers require proof of Renters Insurance from tenants, but even if yours leaves it optional, it’s still a good idea.
Either way, there are various types of Renters Insurance policies as well as various levels of coverage, so you’ll want to become familiar with the options before you choose a policy — or update the one you have.
Renters Insurance Basics
Renters Insurance is to those who rent what Homeowners Insurance is to those who own their own homes. In general, what’s covered by Renters Insurance is primarily the personal property owned by the renter (i.e. any physical damage to structures is typically not covered). From jewelry to electronics or furniture, most people are primarily concerned about those bigger ticket items. Clothing, kitchen ware, and decorations are also typically covered if they become unexpectedly damaged or ruined.
As a tenant, your responsibility is to provide an estimated value of the contents of your apartment or rental home in order to make sure you purchase enough insurance to replace its contents. As a result, the more valuable items you own, the more insurance you’ll need to purchase.
Renters Insurance Options
One important differentiation among Renters Insurance policies is whether they cover replacement cost or actual cash value (ACV). If your policy covers replacement cost, that means it would provide coverage for you to purchase a duplicate item, brand new. If your policy covers ACV, it takes depreciation into account, causing items to have less value over time.
The price of the policy will vary depending on which replacement option a particular plan provides, and the pay out from a claim will be even more significantly impacted.
Renters Insurance Benefits
In the case that whatever caused damage to your possessions also caused significant enough damage to your home that it has become uninhabitable, your Renters Insurance Policy may cover costs of a hotel stay and necessary meals; you’ll want to check the provisions of your policy. (This provision is sometimes referred to as loss-of-use coverage, or relocation expenses.) Your Renters Insurance policy typically also covers your losses in the case of an appliance failure; for instance, if your property manager owns the freezer in your unit and its failure causes you to lose its contents, the price to replace your food would be covered under your Renters Insurance policy.
Hopefully you’re getting a better idea of how it can be helpful to have Renters Insurance — and what kind of plan you’ll want to secure. Some additional issues to consider when you’re shopping around for Renters Insurance — such as coverage limitations, riders, and personal liability — will be discussed in Part 2. Note that it is crucial to carefully read through your Renters Insurance policy to see specifically what your plan covers. Feel free to contact us with any questions, and we will be happy to help clarify the differences between Renters Insurance plans.
The Nicholas Insurance Agency, led by Greg Nicholas, is a family owned business serving the York county, Pennsylvania region. In the insurance business since 1981, Greg Nicholas helps families, businesses and individuals understand the value of different insurance products and make wise decisions when selecting the best insurance products for their specific situations.
Offering exclusively Allstate insurance products, the Nicholas Agency provides auto, homeowners, rental and landlord insurance as well as life & disability, recreational vehicle, motorcycle and personal liability insurance.
For more information, visit our two York, PA locations at Westgate Plaza or York Marketplace or call us at (717) 764-2024.
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