Renters Insurance: What's Covered and What's Not?

You may not be living in a magnificent mansion filled with the the finest things, but what you do own still has value. While 95% of homeowner's have homeowner's insurance, only 57% of renters have renter's insurance, according to the Insurance Information Institute. So why do renters need insurance and should you have it?

Renters insurance might seem like just another bill to pay each month. However, the right policy could keep you from shelling out major cash to replace your valuables after theft or damage (i.e. lightning, fire, tornado).

Most apartment buildings are covered under insurance that your landlord has for the building, but renters insurance covers your personal property that you have inside of your apartment or rental home like your electronics, furniture, clothes, or your childhood collection of Star Wars figures.

In addition to insuring your personal property in your apartment, renters insurance includes liability insurance for damages or injury caused by negligence. As an example, if someone trips over your living room rug and breaks their arm, renters insurance could cover their medical bills and even legal fees that could occur, up to $100,000 for most policies. For things like expensive jewelry, you can also add what's called a personal articles floater for additional coverage.

The average renter typically takes out a policy that covers $30,000 of personal property with $100,000 in liability coverage. The average renters insurance policy costs about $15 per month, but could vary depending on where you live.

Not sure where to start?

Take an inventory of what you own by going room to room with a checklist. You probably have more valuables that you think and this will give you a good estimate of how much coverage you will need.

There are two types of coverage: replacement cost and actual cash value. Replacement cost value will reimburse you the cost of replacing something with a brand-new version— but the policy could cost more. On the other hand, actual cash value factors in depreciation of your belongings, so you might not get enough money to replace your items, but you could pay less each month, but not always.

So if you are losing sleep over the thought of losing your "stuff", it may be time to get renters insurance. Selby Insurance is an independent insurance agency and works with over a dozen insurance companies. Let us help evaluate your situation and structure a renters insurance policy that meets your specific need. Give us a call at (870) 336-2121 or email tobyselby@selbyinsurance.com. Stop by and see us anytime in Jonesboro at 2216 Wilkins Avenue.