Many renters think of insurance for their homes as unnecessary, assuming that the landlord’s policy will cover them in the case of an emergency. However, if your things are damaged by a burst pipe or a fire, or taken in a burglary, without renter’s insurance, you’ve lost it for good. Not only that, but renters insurance can also help protect you from liability in case someone gets injured in your house or apartment or elsewhere by you or your a pet, and will cover living expenses in the case that you need to find temporary housing if your apartment is damaged.
The good news is that for this list of benefits, renters insurance is relatively cheap. In New York, a full year of coverage can cost as little as $125 a year! This is a great deal, considering that damages to a renter from an overflowing sink can cost between $25,000 and $10,000.
When taking out renters insurance, you should consider the following questions:
1. Are all my things covered?
Before getting a policy, it is a good idea to take stock of all the items in your apartment, and their approximate value. Insurance will cover nearly everything, but in the case of expensive art, jewelery, furs, or electronics for a small home business, you may have to get additional coverage for a small fee.
2. What events am I covered against?
While most of the bad things that can happen in an apartment are covered—fire, smoke, explosions, and water damage from burst pipes or overflows—you may not be protected in the case of floods or storms.
3. What kind of policy should I get?
There are two main types of coverage: replacement cost coverage or cash value coverage. Cash value coverage will reimburse you for the current cash value of your items at the time they were damaged or went missing. Replacement cost coverage, while a little more expensive, will pay the cost of replacing your possessions without accounting for depreciation. This is particularly important for things like electronics and clothes, where depreciation happens quickly.
4. What about my roommates?
While most policies cover any family members living together under the same roof, you may not be able to have more than one unrelated roommate living with you. You should also be sure to only get out insurance with someone you trust—many insurances will cut a check to both roommates, regardless of whether only one of you suffered damages. Because of this, it is also important to keep current with who is on your policy after a roommate moves out.