Renters’ Insurance

With the increasing restrictions on credit and high closing costs, many people are opting out of purchasing a home and choosing to rent instead. Many renters fail to sign up for personal property insurance, as they believe that the property owner’s policy will cover them in the event of a loss. While the landlord’s policy does cover structural damage to a property, renters must purchase their own insurance to cover their own belongings.

 

The Need for Renters’ Insurance
Renters’ insurance can cover property a renter loses due to natural disasters, theft or vandalism. A report from the U.S. Department of Justice shows that renters are nearly 80 percent more likely to be the victims of burglary than homeowners. In order to limit their liability exposure, some property owners may request that prospective renters have their own renters’ insurance before signing a lease.

Types of Renters’ Insurance
Renters’ insurance policies typically have two different types of coverage. An “actual cash value” policy pays the cost to replace the items less any depreciation. A “replacement cost” policy pays out the full amount paid for the items. Replacement cost policies usually have higher insurance premiums, but they also pay out more on a successful claim.

Items Covered by Renters’ Insurance
Most renters’ insurance policies cover the basic items in the rented residence, including furniture, electronics, appliances and clothes. Some high-ticket items, such as jewelry and collectibles, may require separate coverage.

To find out more about renters’ insurance, get in touch with the friendly agents at Simpson Insurance Agency today!