Renters Insurance Basics
Every policy (regardless of type) should have a Declarations Page, commonly referred to as the “Dec Page”. This page “declares” who you are, what property you have insured, your coverage choices and how much you are paying for this policy period.
Similar to Homeowners insurance, there are 2 types of coverage on your Renters insurance policy; Coverage that protects the other party and coverage that protects you.
Coverage that protects the other party:
Personal Liability: Covers you if someone is injured on your property due to your negligence. It may help pay for treatment of their injuries and your legal costs.
Guest Medical Payments: May provide reasonable and necessary medical expenses to a guest on your property injured in an accident.
Coverage that protects you:
Personal Property: This is your contents on the property. This can be written as Actual Cash Value (ACV) or Replacement Cost (RC) coverage. ACV coverage means your belongings are covered at the amount it would cost to replace them minus depreciation. So if you have a 5 year old tv that is stolen, you will receive the amount it would cost to replace the tv 5 years ago. RC coverage means your belongings are covered at the amount it would cost to replace them at the time of the claim. So if you have a 5 year old tv that is stolen, you will receive the amount it would cost to replace the tv at todays cost.
Loss of Use: May provide reimbursement for reasonable increases in living expenses (such as a hotel room or apt) due to a covered loss, if your rental home is uninhabitable.
Deductibles: is the amount you pay out of pocket when you file a claim for a covered loss. You will have several options to choose from for your deductible. If you have a $500 deductible and a $6,000 loss, the insurance carrier would pay you $5,500 for the claim. A higher deductible will generally mean a lower premium and vice versa.
Additional coverage: You may be able to add optional coverage such as extra jewelry coverage or Identity theft restoration or increased coverage for business property.
For Parents of college students: if you have kids living in dorm, remember- personal property coverage on your home insurance policy will extend to the dorm. But it only covers up to 10% of your personal property coverage amount. A renters policy is an inexpensive way to make sure you child is covered at school!