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Why you need renters insurance

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Mark Blog PhotoDid you know that if you're renting and a fire or other disaster destroys your possessions, you could suffer a significant financial loss unless you have renters insurance? Your landlord’s policy does not cover your personal property. The home or commercial property insurance policy your landlord carries insures the landlord’s property, not yours.

A renter’s insurance policy provides protection for your personal property, such as furniture or electronic equipment, in cases like fire or theft. Renters insurance also provides liability protection. Unintentional bodily injury or property damage that you cause to others could be as financially damaging to you as a fire in your apartment. Liability protection against accidental occurrences (such as someone slipping on a wet floor and breaking an arm) comes standard with renters insurance policies.

There is also a difference between replacement cost coverage vs. actual cost. Replacement cost coverage will pay the full amount to repair or replace your belongings instead of covering just the actual cash value of your belongings. For example, let’s say you bought your bike three years ago for $2,000. Actual cash coverage will pay you for the depreciated value of the bike—maybe a couple hundred dollars. Replacement cost coverage will reimburse you for the complete current cost of buying a new bike. Be sure you know which one you have on your policy.

Lastly, the benefits of having renters insurance far outweigh the cost. A common misconception regarding renters insurance is that it’s expensive. In fact, it’s extremely inexpensive. Even if you feel your possessions are fairly modest, losing even one big ticket item or lots of smaller possessions at one time could be financially devastating. Unless you have enough money saved to replace everything you own—clothes, furniture, computer, entertainment system, microwave, etc.—renters insurance is definitely worth the cost.

Prices vary according to the amount of coverage and the deductible you choose, as well as certain risk factors like where you live. Depending on the amount of coverage and the deductible, a typical renters policy with Member Benefits starts at $6–$7 per month.

You may be eligible for discounts on both renters and auto insurance when you purchase both policies from WEA Trust Member Benefits. For a free insurance consultation and comparison quote, give us a call at 1-800-279-4010 or schedule a personal phone consultation at a time convenient for you.

Mark Dannehl, Personal Insurance Consultant