Do you need renters insurance?

November 15th, 2016

renters-insuranceRenter’s insurance provides you with protection against the damage or loss of your personal property.  This applies whether you are renting a house, apartment, condominium or townhouse.  Your Landlord has insurance that will cover the building in case of a loss, but not the contents inside (your personal property).  Many Landlords require the tenants purchase renters insurance prior to leasing to alleviate any liability or miscommunication on what their insurance covers.

In the event that your Landlord does not require renters insurance, do you really need it?  In determining whether or not you need renters insurance, you need to ask yourself the following questions:
How much would it cost to replace my belongings if they were stolen or damaged?

Can I afford to replace my personal property if I have a loss?

Things to consider when picking the right policy for your family:

How Much Coverage? – Keep in mind that you are not only insuring against theft but also fire where you could lose everything.  Be realistic about replacement costs of your personal belongings before deciding how much coverage you need.

Deductible – The amount of the deductible premium that you’re willing to pay will have a major impact on the premium. The higher the deductible, the lower the cost of renters insurance.
Actual Cash Value (ACV) Vs. Replacement Cost – Actual cash value coverage will pay for replacement cost of the item minus depreciation.   Replacement cost coverage that will provide for the actual replacement cost of the item with no deduction for depreciation.

Dogs – Be aware that owning a dog can add to your premium.  Also, depending on breed type some insurance company won’t even offer insurance to customers with certain breeds.

Natural disasters – Flood and Earthquake protection is not commonly included on rental insurance policies. Check your policy for exclusions and if needed add a rider.
Liability Coverage – Liability coverage is usually included with renter’s policy.  This coverage will help protect you in case a guest is injured on your property.  Check the amount provided in policy and determine if you think it’s adequate.
Inventory your items and keep list off site – It is important to keep a detailed list of all of your personal belongings to avoid potential disputes.  Keep receipts and video/pictures of items in your home.
There is a lot to consider when picking a renter’s policy, and I hope this list will help you determine what the right policy is for you.  Don’t be penny wise and pound foolish – renters insurance is inexpensive and can provide you with invaluable peace of mind.

Denver Property Management