Renter's Insurance Guidelines
A landlord's homeowner's or commercial property policy can provide financial protection for the structure of a rental home, but rarely protects the possessions of renters occupying the property. Persons renting homes or apartments can purchase renter's insurance to pay for damages or losses caused by catastrophe or crime. Renters can obtain policies from major insurance companies and tailor coverage to fit individual needs.
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Renter's Insurance
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Renter's insurance can pay for losses or damages to a renter's personal possessions, such as furniture, clothing and electronic equipment. Perils covered by renter's insurance typically include smoke damage, fires, windstorms, theft, lightening and vandalism. When a renter sustains losses or damages to personal items caused by covered perils, the policyholder can file a claim to collect on the policy. Renter's insurance can also include liability coverage to pay for injuries or legal costs resulting from visitor injuries sustained in the policyholder's home. In the event that a rental property becomes uninhabitable, renter's policies can cover additional living expenses. All coverages are subject to the limits of the policy terms.
Types of Policies
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Insurance companies typically sell two types of renter's insurance policies. An actual cash value policy incorporates depreciation of personal items and pays the policyholder the estimated value of belongings at the time of loss or damage. Replacement cost policies pay the current cost to replace items lost or damaged, with depreciation. Policyholders can add floaters (a separate policy for select items) to policies to increase coverage for valuable items, such as jewelry, artwork or furs. Both cash value and replacement cost policies typically include deductibles, the amount the policyholder must contribute before a policy covers damages or loss.
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Inventory
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Insurance companies advice renters to take an inventory of possessions to determine the amount of coverage needed and to document belongings in the event that the policyholder needs to file a claim. Inventory documentation can include sales receipts, appraisals and photographs or videotapes of personal possessions. Policyholders can keep inventories on computer discs, written lists or a combination of both. Renters are advised to store inventories in a safe deposit box or location other than the covered property, such as the home of a friend or family member.
Obtaining Coverage
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Large insurance companies, such as State Farm, Allstate and Geico, sell renter's insurance policies. Renters who have other types of policies, such as automobile insurance, can often obtain a renter's insurance policy through their existing agent. Online insurance brokerages, such as Esurance and Insure, also offer renter's insurance and can often provide a variety of coverages and premium rates from competing companies.
Coverage Cost
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Renter's insurance premiums can depend on where a policyholder lives, the amount of coverage and the policy deductible. According to an article by MSN Money, basic renter's insurance (with no floaters) typically costs $150 to $300 annually to cover $35,000 in personal possessions and up to $300,000 in liability protection. Renters can often lower premium prices by raising the policy deductible or paying six to 12 months of premiums in advance.
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References
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