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Renter Insurance Checklist

Person driving a vehicle

If you rent a house or apartment, your landlord's insurance will only cover the costs of repairing the building if there is a fire or other disaster. You need your own coverage, known as renter or tenant's insurance to financially protect yourself and your belongings.

Renter insurance includes three important types of financial protection: coverage for personal possessions, liability protection, and additional living expenses.

We can help you choose the right coverage.

COVERAGE FOR PERSONAL POSSESSIONS

How much insurance should I buy?

Enough to replace everything in the event of a burglary, fire, or other covered disasters. The easiest way to determine the value of all your possessions is to create a home inventory. 

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. A replacement cost policy will pay the cost of replacing your belongings without accounting for depreciation. Replacement cost coverage is about 10% more, but it is usually worth it.

What disasters are covered?

Renter insurance covers losses from most things ranging from fire and smoke to theft and windstorm. It can even cover you for certain types of water damage. It doesn't usually include flood or earthquake insurance. Your AFI Representative can help you secure the needed coverage if those things may apply to you. 

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. Typically, you'll see deductibles of $500, $1000, or $2000, though higher deductibles are possible. The higher the deductible, the lower the premium, so if you can afford a deductible of at least $1,000, you may get as much as 25% off your premium. 

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 renter 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. Check your renter policy first to see whether certain items, like laptops, are covered and what the deductible is.

LIABILITY PROTECTION

Do I have enough liability insurance in the event someone sues me?

Renter 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 the cost of defending you in court and court awards, up to the limit of your policy. Most standard renter 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 renter policy? This coverage is only for injuries sustained by others and is not a substitute for your health insurance. Medical payments coverage allows someone who gets injured on your property to 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.

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 renter 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, certain limits must be met to purchase this coverage. 

ADDITIONAL EXPENSES

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, renter insurance provides additional living expenses (ALE). ALE pays for hotel bills, temporary rentals, restaurant meals, and other costs 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.

OTHER COVERAGE

I run a business out of my home; do I need supplemental coverage?

A typical homeowner or renter 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. 

Am I covered if I am traveling or away from home?

Most renter polices include what is called off-premises coverage. This means belongings outside of your home are covered against the same disasters listed in your policy. One example is property stolen from your car. However, some companies may limit the amount of off-premises coverage.

DISCOUNTS

Insurance companies often offer discounts on renter 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

     

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.