Renters insurance includes three important types of financial protection:

• Coverage for Personal Possessions
• Liability Protection
• Additional Living Expenses

The following checklist can help you choose the right coverage when you are shopping around for renters insurance or speaking with your insurance professional.

A. Coverage for Personal Possessions

1. How much insurance should I buy? Make sure you have enough insurance to replace all of your personal possessions in the event of a burglary, fire or other covered disaster.The easiest way to determine the value of all your personal possessions—including furniture, clothing, electronics, appliances, kitchen utensils and even linens—is to create a home inventory. This is a detailed list of all of your personal possessions along with their estimated value. An up-to-date home inventory will also make filing an insurance claim faster and easier. The Insurance Information Institute offers free Web-based home inventory software, available at www.knowyourstuff.org.
2. Should I get replacement cost or actual cash value coverage? An actual cash value policy pays to replace your possessions minus a deduction for depreciation whereas a replacement cost policy will pay the cost of replacing your possessions without accounting for depreciation. The price of replacement cost coverage is about 10 percent more but can be well worth the extra expense as the value of most items tends to depreciate quickly.
3. What disasters are—and are not—covered? Renters insurance covers you against losses from fire or smoke, lightning, vandalism, theft, explosion, windstorm and certain types of water damage (such as when the tenant upstairs leaves the water running in the bathtub and floods out your apartment or a burst pipe). Most renters insurance policies, however, do not cover floods. Flood coverage is available from the federal government’s National Flood Insurance Program (888-379-9531, www.floodsmart.gov) and from a few private insurers. You can get this coverage from the same agent or company representative who sold you the renters insurance policy. Earthquakes are not covered either. You can either get a separate policy or have it added as an “endorsement” to your renters policy, depending on where you live.
4. What is my deductible, and how does it work? A deductible is an amount of money you pay out-of-pocket before the insurance coverage kicks in. Deductibles are available as a specified dollar amount, typically $500, $1000 or $2000, though higher deductibles are available. The larger the deductible, the lower the premium charged for the same amount of coverage, so if you can afford a deductible of at least $1,000, you may get as much as 25 percent off your premium. Remember though, that you will be responsible for paying the deductible each time you file a claim.
5. What is a “floater” and do I need one? If you have expensive jewelry, furs, sports or musical equipment, or collectibles, consider adding a floater to your policy. Most standard renters policies offer only a limited dollar amount for such items; a floater is a separate policy that provides additional insurance for your valuables and covers them if they are accidentally lost. You will need to present receipts and/or appraisals for the items covered by the floater. It is important that expensive items be appraised properly as you will pay a premium based on the appraised value and in the event of a claim, be compensated for this dollar amount. You can ask your insurer to recommend a reputable appraiser. For some items, like laptop computers, a stand-alone policy may also be an option. Check your renters policy first to see whether your laptop is covered and what the deductible is.

B. Liability Protection

1. Do I have enough liability insurance in the event someone sues me?Renters insurance provides liability protection that covers you against lawsuits for bodily injury or property damage done by you, your family members and even your pets. This coverage pays for both the cost of defending you in court and court awards—up to the limit of your policy. Most standard renters insurance policies will generally provide at least $100,000 of liability coverage, but additional amounts are available. Consider whether the amount of liability coverage provided by your policy is sufficient to protect your assets. Did you know you also have no-fault medical coverage as part of the liability protection provided by your renters policy? This coverage is only for injuries sustained by others and is not a substitute for your own health insurance. Medical payments coverage allows someone who gets injured on your property to simply submit his or her medical bills directly to your insurance company so the bills can be paid without resorting to a lawsuit. Most policies include about $1,000 to $5,000 worth of this coverage.
2. Do I need an umbrella liability policy? If you need a large amount of liability protection, you can purchase a personal umbrella liability policy. An umbrella policy kicks in when you reach the limit on the underlying liability coverage provided by your renters or auto policy. It will also cover you for things such as libel and slander. For about $150 to $300 per year, you can buy a $1 million personal umbrella liability policy. The next million will cost about $75 and $50 for every million after that. Because the personal umbrella policy goes into effect after the underlying coverage is exhausted, there are certain limits that usually must be met in order to purchase this coverage. Most insurers will want you to have about $250,000 of liability insurance on your auto policy and $300,000 of liability insurance on your renters policy before selling you an umbrella liability policy for $1 million of additional coverage.

C. Additional Living Expenses

1. If I can’t live in my home after a disaster, will I be covered? If your home is destroyed by a disaster that your policy covers and you need to live elsewhere, renters insurance provides additional living expenses (ALE). ALE pays for hotel bills, temporary rentals, restaurant meals and other expenses you incur while your home is being repaired or rebuilt. It is important to know out how much coverage you have, and what the limits are. Some companies provide coverage for a set amount of time, while others have a financial cap.

D. Other Coverages

1. I run a business out of my home; do I need supplemental coverage? A typical homeowners or renters policy provides only $2,500 coverage for business equipment which is generally not enough to replace all of the equipment required by even a small home business. You may also need coverage for liability and lost income. Insurance companies differ considerably in the types of business coverages they offer. Some may meet the specific needs of your business, while others may not. So it is wise to shop around for coverage options as well as price.
2. Am I covered if I am traveling or away from home? Most renters polices include what is called off-premises coverage. This means that belongings that are outside of your home are covered against the same disasters listed in your policy. For example, property stolen from your car would be covered. However some companies may limit the amount of off-premises theft to 10 percent of the amount of personal possessions insurance. If you think you need additional off-premises theft coverage—for example if you travel a lot—shop around for a policy that has the insurance protection you need.

E. Discounts

Insurance companies often offer discounts on renters insurance if you have another policy with them for your car or business. You can also get discounts if you:

• Have a security system
• Use smoke detectors
• Use deadbolt locks
• Have good credit
• Have multiple policies
• Stay with the same insurer
• Are over 55 years old

Companies offer several types of discounts, but these can vary widely by company and by state, so review your options carefully. Also, some employers and professional associations administer group insurance programs that may offer a better deal than you can get elsewhere.

Related Links: Homeowners and Renters Insurance

 

Source: Insurance Information Institute, “Renters Insurance Checklist” http://www.iii.org website. Accessed November 30, 2015. http://www.iii.org/articles/renters-insurance-checklist.html

© Copyright 2016. All rights reserved. This content is strictly for informational purposes and although experts have prepared it, the reader should not substitute this information for professional insurance advice. If you have any questions, please consult your insurance professional before acting on any information presented. Read more.

If you rent a house or apartment and think that your landlord is financially responsible when there is a fire, theft or other catastrophe—think again.

Your landlord may have insurance to protect the building you are living in. But your landlord’s policy won’t replace your personal possessions or pay for your living expenses while the building is being repaired.

The only way to protect yourself financially against disasters is to buy a renters insurance policy.

Renters insurance, sometimes referred to as tenants insurance, includes three basic types of protection:

• Personal Possessions
• Liability
• Additional Living Expenses

Personal Possessions

Standard renters insurance protects your personal belongings against damage from fire, smoke, lightning,
vandalism, theft, explosion, windstorm, water and other disasters listed in the policy. Floods and earthquakes are not covered. Supplemental insurance is available to cover these disasters—see the Frequently Asked Questions section of the brochure for more
information.

To decide how much insurance to buy, you need to know the value of all your personal possessions—
including furniture, clothing, electronics, appliances, kitchen utensils and even towels and bedding. In other words, if your home were to burn, you should have enough insurance to replace all of your possessions.

The easiest way to figure out how much insurance coverage to buy is to create a home inventory (a detailed list of all of your personal possessions, with their estimated value). To help make this task easier, the Insurance Information Institute offers free Web-based software, which you can find at www.knowyourstuff.org. An up-to-date home inventory will also make filing an insurance claim faster and easier.

Liability

Standard renters insurance policies provide liability protection against lawsuits for bodily injury or property
damage that you or your family members cause to other people. It also pays for damage your pets cause.
So, for example, if your son, daughter or dog accidentally ruins your neighbor’s expensive rug, you’ll
be covered. However, if your children or pets destroy your own rug, you will not be covered.

The liability portion of a renters policy pays for both the cost of defending you in court and for court awards, up to the limit of the policy.  Liability limits generally start at about $100,000.  Some experts recommend that you buy at least $300,000 worth of protection. You can also buy anUmbrella or Excess Liability policy, which provides higher limits and broader coverage.  Generally, umbrella policies cost between $200
to $350 a year for an extra $1 million of liability protection.

Your policy also provides No-fault Medical coverage.  So, if a friend or neighbor is injured in your home, you can submit their medical bills directly to your insurance company. You can generally get $1,000 to $5,000 worth of this coverage. It doesn’t, however, pay the medical bills for your own family or your pet.

Additional Living Expenses

Many people don’t know that Additional Living Expenses coverage, also known as ALE, is included in a renters insurance policy. If your home is destroyed by a disaster that your policy covers and you need to live elsewhere, renters insurance covers your additional living expenses.  Policies will generally reimburse
you the difference between your additional living expenses and your normal living expenses. ALE covers hotel bills, temporary rentals, restaurant meals and other expenses you have incurred while your home is
being rebuilt.

There are two types of renters insurance polices:

Actual Cash Value pays to replace your possessions minus an amount for depreciation (the reduction in the value of items due to age and use) up to the limit of your policy.

Replacement Cost pays the actual cost of replacing your possessions (with no deduction for depreciation), up to the limit of your policy. The price of Replacement Cost coverage is about 10 percent more than Actual Cash Value coverage but can be well worth the extra cost.

How to Buy Renters Insurance

Renters insurance is easy to get, and there are many insurance companies to choose from. Insurers who offer homeowners insurance generally also sell renters insurance. In fact, a renters insurance policy and a homeowners insurance policy are almost identical. The main difference is that a renters policy doesn’t include coverage for the building, since the landlord owns that.

Comparison Shop

Prices vary from company to company, so it pays to shop around. Get at least three price quotes. You
can call companies directly or get quotes from the Internet. Your state insurance department (contact
information is on the back of this brochure) may also provide information about prices.

Get quotes from different types of insurance companies. Some insurers sell through their own agents. These agencies have the same name as the insurance company. Some sell through independent agents, who offer policies from several insurance companies. Others don’t use agents at all but sell directly to consumers over the phone or via the Internet.

But don’t shop by price alone. Select a company that answers your questions and handles claims fairly and efficiently. Ask friends and relatives for their recommendations.

Look for an agent or company representative who takes the time to answer your questions.  Remember, you’ll be dealing with this person if you have an accident or other emergency.

Ask Your Insurer How You Can Save Money

These are some ways to save money on premiums: Consider taking a higher deductible (the amount of money you have to pay toward a loss before your insurance company starts to pay a claim). The higher your deductible, the more money you save on your premium. Consider a deductible of at least $500. If you can afford to raise it to $1,000, you may get as much as 25 percent off your premium.  Remember, though, that you’ll pay the deductible each time you file a claim.

Insurance companies often offer discounts on renters insurance if you have another policy with them for your car or business. You can also get discounts if your apartment has a security system, smoke detectors or deadbolt locks. More discounts might be available depending on your age or whether or not you smoke.

Filing a Renters Insurance Claim

REPORT ANY CRIME TO THE POLICE

If you are the victim of a theft or your home has been vandalized or burglarized, report it to the police. Get a police report and the names of all law enforcement officers that you speak with.

PHONE YOUR AGENT OR COMPANY IMMEDIATELY AND GET ANSWERS TO THESE QUESTIONS: 

• How long to I have to file a claim? (There are time limits on claims filing.)
• Do I have the coverage I need?
• Does my claim exceed my deductible?
• How long will it take to process the claim?

PREPARE A LIST OF LOST OR DAMAGED ARTICLES

You’ll need to substantiate your loss. Don’t throw out damaged items until a claims adjuster has visited
your home. You should also consider photographing or videotaping the damage. Prepare a list of damaged or stolen items for your adjuster along with copies of receipts.

IF YOU NEED TO RELOCATE, KEEP YOUR RECEIPTS

If your home is severely damaged and you need to find other accommodations while repairs are being
made, keep records of all expenses.

GET CLAIM FORMS

Once you’ve notified your insurer of your claim, the company is required to send the necessary claim forms to you by the end of a set time period. (The time period varies from state to state.) Return the
properly filled out forms as soon as possible to speed up your claim.

If you feel your insurer hasn’t given you satisfactory service, you should talk to the agent or company representative who sold you your policy or your insurer’s claims manager. If you’re still unhappy, contact your state insurance department or local consumer protection office to discuss what you can do.

State insurance department telephone numbers and Web site addresses can be found here.

Frequently Asked Questions

Q. Is my bicycle covered by renters insurance?

A. Your bicycle and other recreational or sports equipment are covered. There are also special policies you can buy for very expensive sports equipment.

Q. Is my car covered?

A. Vehicles aren’t covered by renters insurance.  You need to get a separate auto insurance policy to drive legally and protect your car, van or motorcycle.

Q. As a student, am I covered by my parents’ insurance?

A. If you’re a college student living in a dorm and are still part of your parents’ household, their homeowners or renters insurance provides coverage. If you live off campus, you’ll probably need your own renters policy. Policies can vary, so speak to your insurer about this.

Q. Can I purchase a renters policy with my roommate or domestic partner?

A. Regulations differ from state to state, and policies might also differ from company to company. Find out
what regulations apply where you live. Some insurance companies allow unmarried couples who have been living together to buy joint coverage. But a domestic partner is usually not automatically insured, like a husband or wife, under the partner’s policy. He or she must be specifically named.

Q. What happens if something I have rented or borrowed is stolen?

A. Items that are “in your possession” are covered under a standard renters policy, whether they are things that you’ve bought, received as gifts or borrowed.

Q. Is my property covered away from home?

A. Yes, most renters polices include what is called Off-premises coverage.  This means that belongings that are outside of your home are also covered against the same disasters listed in your policy. For example, property stolen from your car would be covered. However, there are generally dollar limits on the amount you can be reimbursed. For example, if you have $25,000 worth of personal possessions insurance, you may be covered for up to $2,500, or 10 percent of the total.

Q. Are my valuables covered by my renters insurance policy?

A. In general you are covered for up to $1,500 for jewelry or other expensive items that are destroyed or lost to fire, windstorms, theft or other perils that are listed in your policy.  If your valuables are worth more than that, you should consider purchasing a “floater,” also called an “endorsement,” to increase the amount of coverage.

Q. How can I protect my house or apartment against a flood or earthquake?

A. Renters insurance does not cover floods or earthquakes. Flood coverage is available from the National Flood Insurance Program (888-379-9531, www.floodsmart.gov ) and from a few private insurers. You can get this coverage, however, from the same agent or company representative who sold you the renters insurance policy. Earthquake coverage can be a separate policy or an “endorsement” to your renters policy.

 

Source: Insurance Information Institute, “Renters Insurance”
http://www.iii.org website. Accessed November 30, 2015. http://www.iii.org/brochures/renters-insurance.html

© Copyright 2016. All rights reserved. This content is strictly for informational purposes and although experts have prepared it, the reader should not substitute this information for professional insurance advice. If you have any questions, please consult your insurance professional before acting on any information presented. Read more.

Renters insurance provides financial protection against the loss or destruction of your possessions when you rent a house or apartment. While your landlord may be sympathetic to a burglary you have experienced or a fire caused by your iron, destruction or loss of your possessions is not usually covered by your landlord’s insurance. Because in most cases, renters insurance covers only the value of your belongings, not the physical building, the premium is relatively inexpensive.

By purchasing renters insurance, your possessions are covered against losses from fire or smoke, lightning, vandalism, theft, explosion, windstorm and water damage (not including floods). Like homeowners insurance, renters insurance also covers your responsibility to other people injured at your home or elsewhere by you, a family member or your pet and pays legal defense costs if you are taken to court.

Renters insurance covers your additional living expenses if you are unable to live in your apartment because of a fire or other covered peril. Most policies will reimburse you the difference between your additional living expenses and your normal living expenses but still may set limits as to the amount they will pay.

There are two types of renters insurance policies you may purchase:

1. Actual Cash Value – pays to replace your possessions minus a deduction for depreciation up to the limit of your policy
2. Replacement Cost – pays the actual cost of replacing your possessions (no deduction for depreciation) up to the limit of your policy

With either policy, you may want to consider purchasing a floater. A standard renters policy offers only limited coverage for items such as jewelry, silver, furs, etc. If you own property that exceeds these limits, it is recommended that you supplement your policy with a floater. A floater is a separate policy that provides additional insurance for your valuables and covers them for perils not included in your policy such as accidental loss.

Source: Insurance Information Institute, “What You Need to Know About Renters Insurance” http://www.iii.org website. Accessed November 30, 2015. http://www.iii.org/Articles/Can-I-get-insurance-if-I-rent-my-home.html

© Copyright 2016. All rights reserved. This content is strictly for informational purposes and although experts have prepared it, the reader should not substitute this information for professional insurance advice. If you have any questions, please consult your insurance professional before acting on any information presented. Read more.

Dear Valued Customer,

In this issue of “———————“ we focus on Renters Insurance.

Renters insurance provides financial protection against the loss or destruction of your possessions when you rent a house or apartment. Not only that, because renters insurance covers only the value of your belongings, not the physical building, the premium is relatively inexpensive.

Read on to find out what you need to know about renters insurance, the three basic types of protection, review the renters insurance checklist, and more.

The facts support the need for renters insurance. We appreciate your continued business and look forward to serving you.

Kind regards,