Why Renters Need Insurance

When you own a home, it is no surprise that insurance is required in the event tragedy strikes. When you rent a place, it is kind of surprising that insurance is not required given that renters likely have more to lose and face bigger risks.
 

Risks As A Renter
When you rent an apartment, especially one in a building where many other tenants live, the likelihood of fires or other incidents increase than if you are living in a single family home. Residents in buildings face loss at the expense of others every day. Who is to say that neighbors will be responsible about turning the bath water off or not falling asleep while smoking. Once an incident like that occurs, it can be devastating to those in the building who have ruined furniture and other personal belongings. Renter's insurance can help protect people from such loss and damage.
 
What To Know About Renter's Insurance
The first thing to know is that renter's insurance is relatively inexpensive. If you add it with other existing insurance you have, such as auto coverage, you get even deeper discounts. Renters insurance policies can be written in various ways but the policies generally consist of two types:
 

• Actual Cash Value – the coverage which will pay market value at the time for all of the damage.
• Full Replacement Cost – the coverage which will pay the full amount to actually replace the items you lost. Essentially you can get all new stuff.

 
Depending on your needs, either policy type is worth investigating if you rent. The Full Replacement Cost does seem like the better option if the premium and terms are within your financial capabilities. Many renters make the mistake of thinking what they own do not add up to much. However, if you really take a tally of what you owe (think electronics, furniture, jewelry, and other valuables), you can be facing some serious financial set backs if something should happen and you are not insured.
 
If you are considering renter's insurance, check first with the agent or insurance company you already use. You can save money by having several policies with one company. If your agent does not provide renter's insurance policies, you can search online and compare prices fr the type of policy you need as a renter. It is best to shop and compare to find not only the least expensive prices but also the most important aspect – coverage.