|Renter's insurance (aka tenant's insurance) exists to protect us urban dwellers against personal belonging loss and provides coverage for liability. The policy (HO-4) is called a package policy, because it combines loss and liability coverage, though for some companies, the liability part of it is optional. In addition to coverage against loss, the policy will include the legal costs of defense if you're sued in a liability case and will pay for increased living expenses, up to a predetermined limit, should you be forced, by a disaster, to live in a different apartment or hotel. Your policy will cover you against the 17 Perils (we love the medieval sound of that), as follows:
1) Fire or lightning
2) Windstorm or hail
4) Riot or civil commotion
5) Damage caused by aircraft
6) Damage caused by vehicles
8) Vandalism or malicious mischief
10) Breakage of glass that is part of the building and damage caused by that breakage
11) Volcanic eruption
12) Falling objects
13) Weight of ice, snow or sleet
14) Accidental discharge or overflow of water or steam from plumbing, heating, air conditioning or automatic fire-protection sprinkler system or an appliance
15) Sudden, accidental tearing apart, cracking, burning or bulging of steam or hot-water heating system, air conditioning, automatic fire-protection sprinkler system or an appliance
16) Freezing of plumbing, heating, air conditioning or automatic fire-protection sprinkler system or an appliance
17) Sudden and accidental damage from artificially-generated electric current
These are generally not included in coverage: enforcement of building ordinances or laws, unless your policy has an endorsement providing this coverage, earthquake or other earth movement, water damage from flooding, surface water, sewer or drain back-up, sump pump overflow, ground water seepage or leakage from swimming pools, rot, mold or mildew, power failure except as provided in additional coverages for food spoilage, neglect in protecting property at the time of loss, war or nuclear hazard, loss caused by a deliberate or intentional action by the insured. Be sure to read the Exclusions section of the policy to be sure.
Types of Coverage:
1. Actual Cash Value: Replaces possessions minus a deduction for depreciation.
2. Replacement Cost: Pays the actual cost of replacing possessions with no deduction for depreciation.
Whichever policy you have, consider getting a floater. Most policies will only give you a limited amount of coverage for big-ticket items, exactly the stuff you'd most want covered, such as jewelry or silver. A floater is an additional policy that covers those items as well as providing coverage for accidental loss.
Getting A Quote:
We can't give you exact numbers because there are so many variables, but generally speaking, renter's insurance is a fairly reasonable proposition. Some companies, such as Allstate and State Farm, allow you to get online quotes. You can also use a free service such as NetQuote to get quotes from a number of different insurers.
The National Association of Insurance Commissioners has a very useful site where you can check out individual insurance companies for things like number of complaints against them last year. The Insurance Information Institute also provides solid consumer info.
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