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If you rent a house, apartment, condo or townhome, you will want to protect yourself with liability coverage to pay any lawsuits and defense costs and personal property coverage for your valuables.   In addition, most landlords require this coverage as well. 

Imagine losing all your furniture, clothes and other belongings in a fire, theft or other disaster. Renters insurance is meant to rescue you at these times of disaster.

You may be able to protect all your belongings for less than $200 a year. The average renters insurance premium is $187, according to the latest numbers from the National Association of Insurance Commissioners (NAIC). But that will also depend on where you live and how much you want to insure for.   You may also qualify for discounts for multi policy discount and no prior claims discount and secure community discount as well as other discounts.

What renters insurance covers

How renters insurance worksThere are several types of home and renters insurance policies. A policy called the HO-4 is designed for renters and covers damage from 16 types of perils:

  1. Fire or lightning
  2. Windstorm or hail
  3. Explosion
  4. Riot or civil commotion
  5. Damage caused by aircraft
  6. Damage caused by vehicles
  7. Smoke
  8. Vandalism or malicious mischief
  9. Theft
  10. Volcanic eruption
  11. Falling objects
  12. Weight of ice, snow, or sleet
  13. Accidental discharge or overflow of water or steam from within a plumbing, heating, air conditioning, or automatic fire-protective sprinkler system, or from a household appliance
  14. Sudden and accidental tearing apart, cracking, burning, or bulging of a steam or hot water heating system, an air conditioning or automatic fire-protective system
  15. Freezing of a plumbing, heating, air conditioning or automatic, fire-protective sprinkler system, or of a household appliance
  16. Sudden and accidental damage from artificially generated electrical current (does not include loss to a tube, transistor or similar electronic component)

What renters insurance won’t cover

Just as with home insurance policies, renters insurance won’t cover damage from “earth movement,” which includes earthquakes, mudslides and landslides.

Also typically excluded are:

  • Floods
  • War
  • Nuclear hazard
  • Neglect, meaning your failure to save your property at the time of loss or after.
  • Intentional loss, meaning your intentional destruction of your property.
  • Governmental action, such as seizure of your property.

You may purchase flood insurance separately to secure against damage from flood.

Coverage with dollar limits

You’ll likely find that your renters insurance policy states specific dollar limits are certain items. If your items have more value, you’ll need to purchase riders to fully cover them. Here are examples of items that often have dollar caps on coverage, along with typical limits:

  • Cash - $200.
  • Securities, passports and stamps - $1,500.
  • Theft of jewelry, watches and furs - $1,500.
  • Theft of firearms - $2,500.
  • Theft of silverware, goldware, flat ware: $2,500.
  • Unauthorized charges to your credit card: $500.

Without riders for these expensive items you can't recover the full loss if it's beyond your policy limit.

Additional renters insurance benefits

Liability protection for property-damage and bodily-injury lawsuits against you is generally standard with renters insurance policies. This means if someone in your unit slips and falls and sues you, you're covered for any costs, up to your liability limit. The insurance company will also pay for your legal defense.

If your apartment or condominium becomes uninhabitable due to a fire, burst pipes or any other reason covered by your policy, your renters insurance will cover your "additional living expenses." Generally, that means paying for you to live somewhere else.

Take inventory

To ensure you’re compensated for any belongings you lose from a fire, storm or other catastrophe, you should inventory all of your personal belongings. List each item, its value and serial number when possible. Photograph or videotape each room, including closets, open drawers, storage buildings and your garage. Keep receipts for major items in a fireproof place.

To make things easier, the Insurance Information Institute has free inventory software at KnowYourStuff.org.

Saving money on renters insurance

Just like homeowners insurance policies, your renters insurance premium depends on a number of factors: where you live, your past claims, your deductible, your insurance company and whether you need any additional coverage.

Common ways to save on renters insurance include:

  • Increasing your deductible (the amount you pay before your coverage kicks in).
  • Asking for discounts for smoke and fire detectors, and security systems.
  • Buying your car insurance from the same company, called a “multiline” discount.
  • Paying your renters insurance bill in full rather than in installments.

To find the best premium,  contact an independent insurance agent like us to shop many insurance carriers.   Suzanne Brown Insurance Agency 281-558-2210 www.SuzanneBrownAgency.com

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