When renting an apartment, it is a common misconception that you as a tenant and your belongings are covered by the landlord’s insurance. But in reality, these types of insurance usually cover only the home structure and the land that it stands on and not the items and people living in the unit.
It is not mandatory for a tenant to acquire insurance coverage when renting a home. However, it is strongly advised to have one to secure your personal belongings.
A renter’s insurance can cover any and all your belongings, whether that be an expensive piece of furniture such as antique dressers or small electronic gadgets such as laptops or mobile phones. The price of the insurance depends on the number and value of items to be covered.
Another misconception is that in case of roommates sharing the same unit, it is not necessary for each to have their own policy. Renters should understand that the insurance covers only those of the policy holder. Meaning if there are three renters in an apartment, it is best to have three separate policies to cover each individual’s properties.
There are several types of insurance policy that are available for tenants. Choosing one or all of the policies depends on the tenant’s preference and properties.
Replacement cost value insurance works best with items that have a fast depreciating value. This type of insurance replaces damaged property based on the actual cost of the item of the time it was bought. It is usually much more expensive than the next type of insurance.
Actual cash value insurance replaces items based on their current value in the market. This insurance is best for antiques, jewelries and other items that appreciate in time.
Liability insurance provides you with protection should there be any accident resulting in injury inside your home. The insurance covers medical and defense expenses should the injured person decide to sue you.