August 04, 2006
Rent a Home? Take Renters Insurance
I’ve spoken so much about homeowners insurance and how you should ensure that you have your insurance, file for it, how to reduce insurance rates, …the works. However, not all of us live in our own homes. Yes, we do dream of owning a home of our own, but that doesn’t necessarily translate into reality so soon. So, what happens if you have rented a home, or an apartment? Are you exempt from taking insurance? That would be a nice though eh? Sadly, if you don’t insure your stuff, your homeowner aint gonna do it for you.
So, even if you don’t like it, do go out and take insurance, no not homeowners, but renter insurance. This insurance will provide coverage to you, in the event that your belongings are lost. And guess what, it will also cover your ass in case you do something naughty like damage your landlord’s property (by mistake of course!). For instance, if you host a party, and one of your guests makes a hole in the wall!
Fine, let’s get back to business. What do you need to consider before taking insurance? First, create an inventory. Take stock of your dwelling. Make note of all items of value, and especially of those items with high value/high replacement cost. You could catalog all your possessions for easy reference in future.
Decide your deductibles. Remember, the higher the deductible, the lower your premium will be. If you’ve taken a basic policy, it will begin with coverage for the actual cash values of your covered belongings. Example: a 5-year-old washing machine would be covered for its initial cost, minus the depreciated cost. You may not get much money for that one coz minus the depreciation the value isn’t much. In such cases, you could opt for replacement cost coverage instead. With this coverage, you would be reimbursed for the total current cost of a washing machine. BUT, remember this kind of coverage is more expensive.
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