Why You Should Consider Having Renters Insurance

Why You Should Consider Having Renters Insurance

Updated September 5, 2020
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Why You Should Consider Having Renters Insurance

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Just because you rent your home doesn’t mean it isn’t worth having an insurance policy that covers the place you call home.

Many people incorrectly assume that insurance is only something that homeowners have to think about, and while it’s true that that you aren’t liable for physical damage to the walls, ceiling and floor in the event of a covered disaster, the contents of the apartment are most certainly your concern - and that’s just one of many things a renters insurance policy will cover.

What’s Covered By Renters Insurance?

Most policies cover issues that a renter would have to deal with that fall into a handful of categories:

  1. Temporary Accommodations. There are many reasons you might be forced to temporarily relocation: unexpected repairs, fire or smoke damage, flooding, or even remediation. Renter’s insurance will limit your out-of-pocket costs in these cases.
  2. Liability. Even though you don’t own your home, if someone injures themselves while in the space you are renting, it’s possible you may be sued to cover medical bills and incur legal costs if you are sued. Renter’s insurance isn’t the only way to limit liability, but it’s one of the features most policies have.
  3. Optional Additions. If you have special needs, you can usually add riders to suit your needs. In most cases, these are meant to cover valuable property, like jewelry, a cherished musical instrument, or artwork. Usually the additional premium is based on the value of the property being covered.

How Much Does It Cost?

The good news is that renters insurance is usually fairly inexpensive compared to other types of insurance – around $20 or $30 per month, though it depends on many factors including where you live, the deductible amount (how much you would pay out-of-pocket before the policy would cover you), how valuable your property is, and your personal history including your credit score and claims history. Newer companies like Lemonade offer plans starting at just $5/month.

That said, there are a few ways that you can save even more when shopping around for a renters insurance policy:

Save By Bundling

If you have another insurance policy, such as auto insurance, you can often get a better rate if you bundle the policy with the same company. Insurance companies will offer discounts to grow business with existing customers, use this to your advantage!

Insurers Love Automatic Payments

If your policy bills each month, you may be able to get a discount by agreeing to enroll in automatic or annual payments - plus you don’t have to worry about missing a payment and incurring a fee. Alternatively, agreeing to pay the whole year up-front can have the same effect.

Shop Around & Negotiate

Getting more than one estimate is always a good idea, but even if you have a policy in place, set an annual reminder to call up your insurer and ask if they can do any better. If you haven’t filed any claims, there’s a chance they may be willing to revisit your premium, or extend additional coverage for the same price. Having a competitor’s quote handy can help make a stronger case.