Many renters think, “Well, my landlord has insurance, so I’m covered.” In actuality, your landlord’s insurance policy only covers THEIR rental structure and property; it does not cover YOUR personal belongings.
For college students, coverage can come in two forms: your parents’ homeowners policy or your own renters policy.
If you’re a college student under 26 years old, enrolled in classes, and living in on-campus housing, you may be covered under your parents’ homeowners or renters insurance policy.
If you’re a college student like Jada, renting an off-campus apartment or house while away at school, you will need renters insurance to protect your personal belongings.
So, exactly what does renters insurance cover? Renters insurance policies typically include three types of coverage:
Personal Property Coverage. This type of coverage pays to repair or replace personal property like your laptop, television, stereo, bicycle, and furniture if they are stolen or destroyed. Within this coverage, you have two options: actual cash value or replacement cost coverage.
Actual cash value coverage takes depreciation into account. So if someone steals your five-year-old laptop, the insurance company will only reimburse you for what it is worth today.
Replacement cost coverage does not factor in depreciation. Your insurance company will help cover the cost of replacing your laptop with one of a similar make and model today. With this coverage, you’ll have a higher premium, but you are more likely to receive accurate compensation for your laptop.
Liability Coverage. Say a guest trips and falls and is injured in your home, or maybe your dog happens to bite someone. While no one expects to be held liable after an accident at their home, liability coverage protects you from shouldering the cost of medical expenses or legal fees completely out of pocket.
Loss of Use. What if someone else in your apartment complex starts a fire that prevents you from living in the residence for a period of time? Loss of use coverage will pay the necessary living expenses required to maintain your current standard of living while the apartment complex is being repaired. This can include things like a hotel stay, replacing personal essentials, food bills in excess of normal grocery/restaurant bills, cooking supplies, and the cost of moving property into storage.
How much renters insurance do I need? Where do I start?
To determine how much renters insurance you need, start by making a list of all the gizmos and gadgets you plan to take with you to your new home. Knowing what you own and its value will help you buy enough coverage to replace your property if it’s stolen or destroyed. You can use the Texas Department of Insurance’s Home Inventory Checklist to help you get started. Once you’re through, be sure to store the list in a fireproof place or a secure, off-site location.
For high value items, like a MacBook Pro or an extensive vinyl collection, you may need to purchase a “floater” to fully cover them. All policies, even a renters insurance policy with replacement cost coverage, have dollar limits for certain items.
By far, the easiest way to learn how much renters insurance you need is to actually speak with an independent insurance agent. They will help you assess your coverage needs and can compare costs from several insurance companies to find the best policy for you at a competitive rate.
Still have some lingering questions in need of answers? Drop us a message or call us directly. We’re here to help!
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