Understanding the Components of a Renters Insurance Policy

Do you fully comprehend the components of a renter’s insurance policy?

Renting a condominium, an apartment or a house? Hopefully you have heard of renters insurance and already have a good insurance policy. You don’t? Your personal possessions are not covered for fire, flood theft etc? Please read on and learn the components of renters insurance. Without this vital knowledge a person can make all the wrong decisions in lieu of protecting their personal possessions and choosing the wrong renters insurance. So what are the components of a renters insurance policy?

A renters insurance policy is insurance which is specifically designed to protect the contents of a rented property against losses caused by fire, hurricane, tornado, theft, flood, other natural disasters and much more. Renters insurance even protects against public liability in lieu of accidents such as tripping over garden hoses, falling down slippery stairs and and so forth. Specifically designed to alleviate any financial hardship renters insurance is often greatly misunderstood.

Renter policies are a little different to the usual household insurance policy. These policies specifically itemize what it is actually insuring. Insurance could be for fire, lightning, wind damage, malicious damage, vandalism or burst pipes. Renters insurance can also cover damage to properties below your apartment in lieu of accidents with water mains etc. It can also include medical expenses of residents and non-residents.

Covers can often include what insurance agents call riders, these are actually extra coverage added to a renters main policy. Most windstorm or hail damage cover comes under the rider category. Now two types of methods are used to evaluate a renters policy and these are, cash value and replacement expenses. These two differ greatly as cash value replacement only covers the what the particular item was worth at the time of loss, it does not cover replacing old for new. Note that a household appliance which was worth for $600 seven years ago will cost a great deal more to replace nowadays. Replacement cost policies differ in the sense that you will be reimbursed for the actual market cost at the time of the loss.

Antiques, jewellery, collector’s items etc must be declared and itemized at the time of their actual purchase and included in the renters policy. These can be either separate or rider policies, the choice is yours. If they are not declared at the time of the policy purchase or added as soon as they are purchased, you will not be covered for the loss. Keep any documentation in regards to purchases elsewhere, perhaps in a safe deposit box.

Renters policies can incorporate coverage for dog breeders and home businesses. Ensure that your policy covers the particular breed of dogs you are breeding, as some insurers refuse to cover certain breeds. If your home business entails owning a plethora of office paraphernalia makes sure all these expensive items are covered and itemized in detail. Many renters fail to inform their insurer of the expensive items they have in their home offices, other than to say , Oh just a load of office stuff. That doesn’t tell an insurer that you may have $20,000 worth of software, filing cabinets, DVD’s, computers and so forth!

Renters insurance policies are relatively inexpensive, it’s certainly an effective way of protecting your possessions and finances in case of unforseen incidents.