If you are thinking about purchasing renter’s insurance, the basic question that it comes down to asking yourself is “do I need insurance for my possessions?” If you have a lot of expensive things that you wouldn’t be able to replace if they were suddenly gone, chances are you will want renter’s insurance. If you are keeping all your valuables at home you will most likely want to buy renter’s insurance. Depending on where you live, renters insurance generally only costs about $250-$300 per year, so it can really be worth it if your possessions are worth thousands of dollars.
Liability from Injured Guests
A very important reason renter’s insurance is worth it is in case someone is injured at your rental property. People these days are hot to sue, so if someone gets seriously injured at your house or apartment that you are renting, you can be held liable if they decide to sue.
Possessions Really Add Up
Likely, your landlord only has insurance over the property itself, and not what you have inside it. So if you have expensive things such as computers, laptops, money, jewelry, televisions, gaming systems or other costly items, you definitely want to purchase renters insurance. You might not realize how much all your property is actually worth. Even if you are just a college student renting an apartment, the value of your personal property could be worth a lot more than you realize.
Damage, Theft & Negligence
Generally personal property insurance covers fire, theft, water and vandalism. So even if some of your property is destroyed due to your own personal negligence from leaving a candle burning or something else that either you or your roommate did on accident, your property will still be protected. Oftentimes renters insurance plans will even cover pet injury if something were to happen to your pets.
Actual Cash Value vs. Replacement Cost Coverage
There are two different types of personal property insurance for renters. Actual cash value and replacement cost coverage. If you don’t have a lot of money in savings, replacement cost coverage is going to be the best bet to make sure that you can replace your essential items if anything happens to them. If something happens to your laptop or books, you want coverage to be able to replace them. Cash value coverage only covers what your old items would sell for on the market currently, so if something happened to your laptop or something like that it could only be worth a few hundred bucks, which probably wouldn’t be enough to buy a new one.
More Than 50% Don’t Have It
While most homeowners have insurance plans, more than half of renters don’t have renters insurance. This is because many people who rent are young and have never bought insurance or might never have experienced anything where they benefitted from having insurance. Renters insurance is one of those things that isn’t advertised very much or talked about among young people, so many people might not even be aware of it. There is a significant benefit for renters to buy renters insurance, though, and many landlords are now requiring their tenants to purchase it.
When thinking about whether or not to purchase renters insurance, think of the value of your property. Sometimes it can get up to the thousands just when you add up how much your wardrobe costs. When it comes down to it, purchasing renters insurance is worth it unless you want to take the risk that you could lose all your personal property and have no way to replace it.
Stephanie Wilmsmeyer is an insurance agent for State Farm who provides renter’s insurance to those in Columbia, Mo. Find her on Google+!