Renters Insurance
Over one third of all U.S. households are renters. Renting can be a less expensive option over buying because you’re not paying for repairs or maintenance, taxes on property or homeowner’s insurance. However, if something were to happen to your rental property such as water damage or fire, you are responsible for your personal property and possessions that are damaged, lost or destroyed. The building owner is responsible for the dwelling itself, but bears no responsibility for the renter’s belongings. Renters insurance gives you the protection you need to cover the costs of lost or damaged property and even can provide expenses if the dwelling becomes uninhabitable.  The following should help to determine the policy that is best for your needs.   

How much coverage do you need?
Renters insurance is designed to cover the cost of replacing your personal belongings in the event of an accident, theft or natural disaster. Typically, the average renter has approximately $35,000 worth of personal goods. 

Deciding on renters insurance coverage amount can be estimated through taking inventory of your possessions.  Make a list of when you purchased the item and what the estimated value is of that item, and take pictures.  Once you’ve created a list, add it up and you should have a fairly good estimate of how much coverage you need to get.

Renters insurance policies usually include liability coverage, which protects you if someone is injured. Limits range from $100,000 to $500,000 and you can decide the amount of coverage that works for you.  Some policies don’t include coverage for damage caused by earthquakes or floods and you may need to purchase a separate policy to cover things such as these.

Actual Cash Value policy or Replacement Value policy
Actual Cash Value policy premiums are generally much lower than a replacement policy because depreciation and overall use are factors used to determine the value of any damaged property. Replacement Value policy will pay a claim based on what it would cost to purchase a similar item at today’s value. This type of policy can cost more, but if something needs to be replaced, it is the policy that might be best suited for you.  

Money savings
Bundling your renters insurance with other insurance policies is a simple and easy way to save up to 20 percent. Opting for a higher deductible can also save you money on your policy purchase.  A deductible is the amount you will need to pay before your insurance company pays on a claim.  Choosing a higher deductible can equate to a lower premium or insurance cost.

Renters insurance may be required
Some property management companies require renters insurance. It’s a protection for your belongings and its affordable with average monthly estimated cost ranging from $15 to $25 a month. Shop around and use these tips to find the best insurance and protection policy for your needs.  Some property management companies that require renters insurance will monitor to ensure the policy is in force through the term of the lease.  If renters insurance is required under the lease, and you cancel the insurance policy, property managers may force place an insurance policy for you based on non-compliance, which will likely be more expensive.  

What is Homeowners Insurance?
A homeowners insurance policy will cover or provide protection for your home in the event of a fire, storm, theft, vandalism, or other damage. If something were to happen to your home that requires repairs or reconstruction, a home insurance policy will cover some or all of the costs depending on the coverage you select. Home repairs, personal belonging repair or replacement, personal liability costs, temporary living arrangement expenses, and even some medical bills. Homeowners insurance covers structures on your property such as sheds, garages, driveways and fences. Insurance policies also cover personal property such as appliances, computers, bicycles and jewelry.

Policies may include loss of use or additional living expenses in the event you would need to temporarily move out of the home for repairs or construction. Liability coverage provides protection in the event someone gets injured on your property as there may be medical expenses or legal action taken against you.  Your insurance policy may cover some of the medical expenses and legal costs up to a limit.

How much coverage do you need?
Before choosing a homeowner’s insurance policy, you will need to determine how much coverage you need. Estimate how much it would cost to rebuild your home by measuring the square footage and multiplying it by cost per square foot. Your insurance agent may have recommendations and assist with this calculation to set a value on your home.  This will allow you to know how much coverage need. Once you have set a value on your home coverage, you’ll need to determine your personal property coverage amount which is typically between 10-50% of the home value. You may also want to consider the area where you live to assess the risk of flooding, earthquakes and fire. If the risk is high, you may want to consider a policy that offers coverage for disasters such as these.

Know what is not covered
Homeowner policies generally do not cover intentional damage or neglect of the property owner, wear and tear, wars or government action, electrical power outages, infestations, mold, mildew, earthquake or flood damage among other things. Ask you agent about separate policies for coverage if you are at high risk in these areas.

Homeowners insurance costs
Insurance policies can differ in terms of what is covered, premiums and rates, and the time involved in filing and fulfilling claims. Your annual insurance cost or premium will depend on the level of coverage you choose. It’s a good idea to compare insurance providers and the policies they offer to find the best insurance option for your needs. Homeowners insurance costs will vary from location, size of the home, age and condition of the home. The average cost for home insurance, nationally, is around $2,500. It’s best to work with an agent to obtain quotes on homeowner policies.

Deductibles and discounts
Higher deductibles generally equate to lower premiums, however it is important to make sure you have the money you need to pay a deductible should you need it. A deductible is an amount you agree to pay before the insurance will provide coverage on a claim.

Discounts may reduce the cost of the premium. Discounts are often provided for homeowners that have carbon monoxide and fire alarms, sprinklers, and security systems. Recently constructed newer homes are often eligible for discounts on the premium. Bundling your insurance products, longevity with the insurance company and low claim rates may be a way to saving money and lower your insurance cost.