“Obviously, the first thing you do when moving into a new apartment is get a new renters insurance policy.” Said no one ever.
In an era when a renters insurance policy costs less than a cappuccino each month, why is it that nearly two-thirds of all renters are still uninsured?
Maybe it has to do with bad branding. “Renters Insurance” isn’t sexy. And the name isn’t totally self-explanatory – it doesn’t exactly sound like protection for your stuff or damages you may cause others.
Even if people do know that renters insurance covers their stuff, some don’t think it’s worth the monthly payment.
Spoiler alert: it is! We’ll get to that sticky point later on.
Bottom line, renters insurance coverage seems to be something we really don’t know how to discuss in simple terms. And most don’t really know the value of it. It’s a shame because it’s one of the most basic investments you can make for a whole lot of peace of mind at a very low monthly cost.
So we’re here to dig deeper and explore the ins and outs of renters insurance: what it is, why it matters, and everything in between, in plain English.
Here’s a quick preview of what we’ll be discussing:
- What is renters insurance?
- What does renters insurance cover?
- What isn’t covered by renters insurance?
- Who is covered by renters insurance?
- How much renters insurance coverage do I need?
- Can I update my coverage after I purchase a policy?
- Do I actually need renters insurance coverage?
What is renters insurance?
A lot of renters insurance companies talk about protecting you from fire, dog bites, etc. But it’s a little misleading. Being “covered” by renters insurance doesn’t mean that insurance companies can actually stop these things from happening. Instead, it can help reimburse you when things don’t go your way.
So, in plain english:
Renters insurance is a safety net for you and your stuff. Along with loss or damage due to theft, fire, vandalism, some types of water losses like burst pipes, and other bad things (“perils” in insurance-speak), it also covers temporary living expenses and certain medical/legal fees.
Common myths about renters insurance coverage debunked:
Before we get into the nitty-gritty of what’s covered and what’s not, it’s important to dispel some common myths about what renters insurance covers.
Often, people think they’re covered by renters insurance when they’re not. Then there are those who think they simply don’t need renters insurance for their home because it doesn’t apply to them.
In any event, here are a few hard facts about renters insurance coverage that may sway these misconceptions:
1. While your coverage applies to anyone in your household related to you by blood, marriage or adoption, it’s probably not enough for your roomie – tell ‘em to get their own policy
2. Your landlord’s insurance covers the structure of your place and any furnishings/appliances they may own inside, but it doesn’t cover you or your stuff
3. If your parents have insurance that’s great but it doesn’t cover your stuff… unless you live with them. If you do, make sure they have enough coverage for your stuff too
4. You may think that you don’t have anything “worth covering,” but you’re probably forgetting about a few key items (think: phone, laptop, bike, etc.)
5. Getting covered isn’t as expensive as you may think – renters insurance policies can start from as little as $5/month
6. Even if you’re never home, renters insurance is still super important as it covers your stuff even when you’re on-the-go
7. Think renters insurance for your home is hard to get (or takes a long time)? Think again. In some cases, you can get covered in less time than it just took you to read these myths!
What does renters insurance cover?
First things first: you’ll want to know why you’re shelling out the $$ to begin with. So know this: renters insurance policies have way more benefits than you probably thought.
A typical renters insurance policy will cover three main areas:
Let’s break it down:
1. Personal property
This type of coverage helps you recover the cost of lost or damaged items for a bunch of different scenarios.
Standard policies cover named perils – bad things that may happen to your stuff – including fire, lightning, windstorm, hail, smoke, vandalism, theft, freezing, damage from aircraft or vehicles, and riots, to name a few.
Over at Lemonade asked, ‘does renters insurance cover theft outside the home?‘ and, ‘does renters insurance cover fire?’ And our answer is: It sure does!
So if a fire in your kitchen destroys your stuff, or if someone breaks in and steals your TV, you’re covered. Just keep in mind that if the stuff in your apartment belongs to your landlord, it isn’t covered under your policy.
You can also add extra coverage for valuable items such as fine art, expensive jewelry, watches, electronics, and more. While these things may need appraisals or other proof of purchase, you can easily add them to most insurance policies for an additional cost. From the Lemonade app, it’s super easy.