Do You Need Renters Insurance?

“Any type of safety feature — a security alarm, sprinkler system, front desk in your building—can decrease the cost,” says Adria Brown, an agent with Allstate in Arlington (703- 558-8200).

So how do you go about choosing a policy? You can get renters insurance from almost any insurance provider. If you already have car insurance, start your shopping there, since companies often offer bundling discounts.

You’ll want to take a good look at what you actually own. Both Allstate and State Farm, for example, offer online tools to help renters assess the value of their possessions. That figure determines the amount of personal-property coverage they need.

A fresh-out-of-college renter with a lot of hand-me-down furniture might be fine with a policy that covers just $10,000 worth of stuff, but someone who frequents Pottery Barn and Banana Republic could need as much as $30,000.

Big-ticket items, such as an expensive engagement ring, require a supplemental piece of insurance called a floater, since their individual value is too high to fall under the standard renters policy.

So who doesn’t need renters insurance? Anyone living in a college dormitory, hotel or executive housing. Temporary living situations can’t be covered by renters insurance.

Like many other kinds of insurance, a renters insurance policy has a deductible, which is the amount of money the insured party must pay before their insurance coverage kicks in. So if your deductible is $250 and you’ve suffered damage to $1,000 worth of your belongings, expect a check for $750.

Some landlords — but not all — require tenants to obtain a renters insurance policy. And some take things a step further by not only requiring that tenants obtain renters insurance but also asking to be listed as an interested party on the policy. Don’t be scared off by that. They typically just want to know if the policy gets canceled and to make sure they understand how the claims process works.

Whether your landlord mandates renters insurance or not, it’s a good idea to evaluate your possess-ions and think about what it would cost you to replace them.

“Things have changed; people own more expensive things now,” Brown says. “And for less than the cost of a pizza a month, a renters insurance policy will protect you.”