In addition, renter's insurance will cover your liabilities as a renter. If someone is injured in your home, it will pay for that person's injuries. If this person sues you, it will pay for the court costs and pay for any damages that may be awarded as a result of the suit, up to a predetermined amount.
The cost of your coverage is your premium. As mentioned above, an average premium is about $200 per year. Where you live, your deductible, what your building is made of, the need for additional coverage and a variety of other factors can either raise or lower your premium. You may find that your insurance company offers discounts for protective devices such as burglar alarms and fire extinguishers that will help lower your premium.
Your policy will reimburse you in one of two ways: "actual cash value" or "replacement cost coverage." Although you will pay about 15 percent more for it, you're usually better off with replacement cost coverage, which pays for what it actually costs to replace the items you lost. Actual cash value, on the other hand, pays only for what your property was worth at the time it was damaged or stolen. The only drawback of replacement cost coverage is that you are often required to pay for the damaged items first, and then submit your receipts for reimbursement. Keeping a complete inventory of your property, as well as receipts and photos or a video tape of your property in a secure place, will help streamline the reimbursement process.
Whether or not you think renter's insurance is a good investment, it is worth your consideration. It may save you from paying out hundreds and even thousands of dollars in the event that an unforeseen peril destroys your property and leaves you without a home. If you do find this to be a valuable investment, contact us for more information.