Why You Need Home Renters Insurance Published April 6, 2012 36th Civil Engineer Squadron Fire Prevention Section ANDERSEN AAIR FORCE BASE -- Rental home insurance is a great investment for people living in apartments or rented homes (military). With the cost of rental home insurance as low as $10 a month, you can have your rental home or apartment covered for things such as fire, water damage or theft. Considering the value of the benefit and the relatively low cost, rental home insurance coverage is a sensible purchase for every tenant. TIP: Shop renters insurance quotes online, and ask your existing auto insurance company if they offer the coverage as well. If you take the time to compare renters insurance quotes, you can find a cheap policy to protect your rented space. Why Buy Rental Home Insurance Just like homeowners insurance, renters face risks of great loss. While they do not have to worry about insuring the building itself, renters do have all of their personal belongings to insure. Just like a homeowners insurance policy covers a variety of situations, your rental home insurance can accommodate a variety of situations: · More often, rental homes are attached to each other. Therefore, the cause of the loss might not be due to your own negligence, but the negligence of your neighbor. Even if you are careful, you are exposed to risks that you cannot control. An apartment renters insurance policy protects you from the uncontrollable and unpredictable actions of your close neighbors. · Renters can be liable to third parties if it is found that they caused injury to them or damaged their property. The insurance liability protection is there for you when someone is injured due to your negligence, such as a loose railing or slick floor on the property. The liability coverage is worldwide, not just at your residence. For example, if you poke someone in the eye with an umbrella while walking down the street, you would be covered by your liability insurance. · Renters also run the risk of being displaced from their home due to damage. If a fire occurs in your rented apartment and you are no longer able to live in your home, rental home insurance provides the coverage that will kick in and pay for you to live in a temporary residence. TIP: There are a lot of reasons to buy insurance for your rental property, the most important of which is the peace of mind and security you get for a relatively low cost. What Home Renters Insurance Coverage Protects You From Home renters insurance insures you against specific perils that can destroy your belongings such as: · Fire or lightning · Explosion · Riot or civil commotion · Smoke · Vandalism or malicious mischief · Theft · Damage by glass or safety-glazing material that is part of a building · Falling objects · Water-related damage from home utilities · Electrical surge damage Home renters insurance covers you, your spouse, members of your household living in the residence under age 21 that are related to you or in your custody or control and any relative who is a full-time student under the age of twenty four, who lived at the residence prior to moving away for school. This coverage would include the possessions of a son or daughter that has recently moved away to college providing they haven't become too old. Keep in mind that your rental home insurance coverage for personal property away from the premise may be limited to only 10% of your personal property coverage limits. Ask for Replacement Cost in your Rental Home Insurance Most policies offer coverage at actual cash value. What this means is if a three year old down coat you owned was destroyed, they would pay you for a replacement coat minus three years of depreciation -hardly enough to get a new coat. When buying rental home insurance, be sure to ask your agent for replacement cost coverage for your personal property. By including replacement cost, the insurance company will replace the lost or damaged items on a "new for old" basis-- meaning no depreciation will be taken on the item(s) as long as you actually replace them. This extra protection does cost a little more, but it is well worth the money because it pays you enough money to actually replace your lost or stolen items. Insuring your Expensive Valuables on Your Rental Home Insurance Policy If you have expensive items to insure, such as a diamond ring, furs or a stamp collection that you store in your rental home, make sure you ask your agent for a rider to your policy that specifically covers these valuable items. Sometimes called a value item insurance rider or jewelry floater, this endorsement insures your valuable items at their appraised value. Without this additional coverage, jewelry, furs as well as your collection would be paid up to the policy limits for these items-usually only around $2,500 per occurrence. Paying a little extra for this rider to your rental home insurance will ensure that you get the appraised value of your expensive personal property. Renters insurance costs very little, but provides extremely valuable coverage. You sometimes can save even more by paying for the coverage annually or by bundling your rental insurance coverage with auto or life insurance you already have.