How Much Renter's Insurance Should You Have?

a ransacked house with a robber climbing out a window
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Renter’s insurance is something every renter should have. It is inexpensive, depending on the amount you take out and your area you will likely pay less than twenty dollars a month for the coverage. It will protect you from theft and loss from fire.

Most people have been robbed or know someone who has been robbed. This policy will protect you from paying for everything out of cost. This is one of the items you should never cut from your budget. It will not take long to apply for a renter's insurance policy. It only takes one phone call to your insurance agent and you will be covered. 

What Renter's Insurance Covers

Your renter’s policy will protect you if you are robbed, or if your apartment burns down. Additionally, renter’s insurance includes liability protection. This protection will cover medical expenses if someone is hurt inside your apartment. This insurance will help you to replace items that are damaged or stolen. The liability insurance is also nice because it will protect the assets and savings that you have acquired. Just like with car insurance you can save money by shopping for a new policy every few years. Here are some things you probably have that will be covered by renter's insurance:

  • Electronics up to the policy limit.
  • Your clothing.
  • Your furniture.
  • Jewelry up to the policy limit.

What Isn't Covered

It is important to realize that a renter’s insurance policy does not cover everything. Most insurance policies will not cover a flood caused by rain. You will need to purchase an additional policy to cover flooding. This is especially important if you live in a floodplain area. Many apartments will let you know if they are located in a floodplain. You need to be prepared for a flood if you live in a flood-prone area. Sometimes flooding can be a result of poor irrigation or landscaping, as well. If this is a serious problem talk to your landlord and have them address it.

  • Items beyond the limit listed on the policy (there are generally limits on electronics and jewelry).
  • Some storm damage or flooding damage.

How Much Coverage You Should Purchase

You need to determine the amount of your insurance policy. When you do this, you should carefully consider the costs of everything you have. If you are robbed, you will likely only need to replace jewelry and electronics. If you are the victim of a fire, then you will need to replace your clothing, your furniture, and other personal effects in addition to your electronics.

In order to determine the amount of coverage you need, you should make an inventory. As you make new purchases, you should add the items and a copy of the receipt to the inventory. You can do this in the cloud or with a safety deposit box. You should have enough money in your emergency fund to cover the deductible on your insurance policy.

Read the Fine Print for Limits and Exclusions

It is important to read your policy carefully. Some insurance companies put a limit on the amount that they will cover in different areas. They may limit the total amount that they would pay in electronics to $500.00.

If this is the case, then you would need to purchase an additional policy to cover those items. If you work from home, you need to consider the cost of the equipment that you use. You may need an additional policy to cover your liability in relation to your job.

Take Advantage of Discounts for Your Policy

When you purchase your renter’s insurance, it is important to shop around. You can receive a discount when you get it through the same company as your car insurance. You should check for discounts through your job, professional associations, and alumni associations, as well.

Using Your Renter's Insurance

When you file a claim with your insurance company, they may have specific requirements that you may need to meet in order to fill out the claim. You should use the inventory to help you file your claim. You must begin by contacting your agent.

Do not attempt to clean up an item or an area until the agent has come out and looked at your claim. Document everything with photographs. Be sure that the date and time are correct in the photos. Be prepared to pay your deductible.​