Why do I need it?

You return to your apartment to discover a water pipe as burst and your computer is sitting in two inches of water.  You go away for the weekend and come to find your home has been burglarized.  You have a party and one of your guests slips in the kitchen and breaks her leg.  The building you live in burns down, taking all your worldly possessions with it.  (These things have all happened to our friends and family in the past year).

These are scenarios none of us wish to contemplate, but they may happen at anytime.  How can you protect yourself if your home entertainment system is stolen, your best friend breaks her leg helping you hang curtains, or everything you own is lost in a fire? 

Two words: renters insurance.  Like homeowners insurance, renters insurance will protect all your personal possessions from loss and protect you from huge legal and medical bills should someone be injured in your apartment. 

You may be thinking...

But my landlord's insurance covers me.  Not true.  This is a common misconception among renters, and it is untrue in almost all situations.  Your landlord carries insurance that will cover his loss in a situation where the building is destroyed or damaged in some way.  Your landlord is covered in case someone (including a tenant) is injured on the property not in your apartment. 

Renters insurance is expensive.  Not true.  The average renter can get complete coverage for a couple hundred dollars or less a year, depending on where he or she lives.  This is a small price to pay for knowing that you and your belongings are protected, isn’t it?

My roommate has insurance, I don't need it.  Not true.  Your roommate's insurance will cover his/her possessions, but it will not cover yours unless you are listed on his/her policy.  It is possible (and even encouraged) for roommates to get a single policy to cover all inhabitants and possessions in the apartment. 

How do I get renters insurance?

It's easy.  If you have a car, talk to the agent who does your car insurance.  Or do a little research and speak to insurance professionals who specialize in this type of insurance.  We've put together a few experts here:  Get Renter's Insurance Now


Replacement Cost vs. Actual Value

A basic policy usually provides for the actual cash value of your belongings.  This means that a 3-year-old computer would be covered for its initial cost minus depreciation.  A computer may well have almost fully depreciated after 3 years, so you would receive little or no cash for it.  If you have expensive electronics or other pricey items which are subject to depreciation, you might want to consider replacement cost coverage instead.  In this case, you would be reimbursed for the complete current cost of buying a new computer or stereo.  Of course replacement cost coverage is more expensive, but may be worth it in many cases. 

Deductibles

Like any insurance policy, renters insurance will have deductibles.  This is the amount of loss you will have to cover out of pocket before receiving any money from the insurance company. 

Endorsements

Like homeowners insurance, renters insurance usually won't cover you for "acts of God" such as floods and earthquakes.  You can get endorsements for these, however, and you should seriously consider them.  Endorsements can also be used to extend the amount of coverage on the policy or the incidents which are covered. 

Liability

Your basic renters insurance will include liability coverage should someone be injured in your apartment.  As with car insurance, there is a per-incident limited on this coverage, and you should make sure this is high enough.  Increasing liability coverage will often not increase premiums much at all. 

Floaters for Special Items

If you have such items as valuable e jewelry, antiques, furs, or other big ticket items, they often will not be completely covered under a basic policy.  To full cover these items from loss, you will want what is called a floater.  These are essentially separate policies covering only these items and can be very inexpensive relative to the replacement cost of the items.  This brings u to an important thing to consider when purchasing insurance: the household inventory.

Inventory

A complete inventory of the items your property should be kept somewhere outside your apartment or at least in a fire proof safe.  Often, you will be able to place copies of such paperwork with your insurance agent. 

To protect your belongings, you should:
1) Write down all the information about each item
a. Model & Serial Number
b. Purchase date
c. Estimated current value

2) Take Pictures or video record what you own
a. Store the tape and pictures away from your apartment
b. Find out if your insurance agent wants a copy of these

Remember, some policies have limits for things like jewelry, computers, and electronics, so if necessary, consider investing in additional coverage for items like these.

Now that you've considered these items, it's time to head out and look for the best policy for you. 

A recent quote for the greater Newark area for replacement insurance of $30,000 was $250 annually.

It doesn't take a genius to figure out that  this small investment in an insurance policy is well worth every penny. Especially when all of your belongings are ruined and it will cost you THOUSANDS to replace… it happens more often than you think.

CLICK HERE to contact a local professional about obtaining Insurance.