The Significance of Renters Insurance

Let me guess, you live in a tiny house? Maybe an apartment? Your furniture was passed on to you from a friend. Your kitchenware is hand-me-down from your Mom. You have some clothes, a nice TV, and a laptop. Otherwise you really don’t have many valuable personal belongings…

In 2017, the average renters policy in Missouri cost $14.42 per month.

A Common Misconception

I don’t own much. What I do own isn’t worth much. That makes sense. On the other hand, do you have 5, 10, $20,000 in your checking or savings to replace your personal belongings in a worst case scenario?

Imagine your dog biting someone on your morning run. Can you afford an attorney’s defense costs, settlement, or a judgement?

Suppose you come home to a flooded apartment? Your neighbor above you has been out of town when a pipe burst in his apartment. Your stuck living in a hotel the next few months. That’s not an expense you budgeted for.

What Does Renters Insurance Cover?

Personal Belongings

Imagine if you could pick up your house or apartment unit and shake it, causing all of the items that aren’t permanently attached to fall out…your clothes, furniture, dishes, electronics, tools, Christmas decor, etc. Those are the items we want to protect. It may not add up to much, but can you self insure those items? Meaning, can you afford to replace those items out of your pocket?

Personal Liability

Imagine being legally responsible for causing injury or property damage to someone else…

• A guest slips and falls.
• Your kitchen catches fire (it may be unintentional, but you may be held liable).
• Your dog bites someone.

Renters Insurance Personal Liability will pay for damages if you’re held responsible for causing bodily injury or property damage to a third party. Additionally, it will pay to defend you in court. Your policy will pay up to the limits shown on your Declarations Page of your policy.

You may not have many assets or feel you have considerable wealth, but in the event of a lawsuit you may be responsible for paying court costs, restitution, your future wages could be garnished for years.

Additional Living Expenses

If the place you call home becomes unlivable due to a covered loss, a Renters policy is designed to pay for living expenses that go beyond your day-to-day.

Maybe it’s paying for your stay at a hotel while your house/apartment is being repaired. The hotel won’t accept pets, so you have to pay for a pet boarding facility (also covered).

Renters Insurance Hacks

Renters insurance is rather inexpensive – less than a $1 per day. Still, saving a few dollars is a bonus. Here are a few common discounts to ask your insurance agent about:

• Security system
• Dead bolts on exterior doors
• Auto insurance with the same company
• Fire extinguishers
• Sprinkler system

Deductible

The higher your Deductible, the lower your premium. I can’t stress enough, you need to be comfortable with your Deductible should you file a claim. For example, if you have a $1,000 Deductible and have a claim, you will be responsible for the first $1,000. If you struggle to have $1,000 readily accessible at anytime you need to look at a lower Deductible.

Preparing a Home Inventory

Every so often, take some time to go room-by-room with a camera or take a video of your personal belongings. You would be surprised at how challenging it may be to remember everything you own after a loss.

Here are two suggestions to save pictures and/or videos of the contents in your home:

• Save the pictures/video on a jump drive and store it in a lockbox at your bank.
• Upload the pictures to the cloud for safekeeping (i.e. Dropbox, Box, Google Drive).