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If You Rent, You Need This

July 15, 2014

DailyWorth Expert

Certified Financial Planner, entrepreneur and CEO/founder of Financially Wise Women

http://www.financiallywisewomen.com

Do you know that over one-third of Americans rent?

And yet, most people who rent do not have any protection in place to cover themselves or their belongings from personal or liability damages. Stuff happens. Sometimes pipes burst, a spark ignites a blaze or thieves find an unlocked door. Renters insurance protects against personal and liability damages much like homeowner’s insurance.

A few weeks ago, a client emailed me to thank me for recommending she get renter insurance. The night before, she woke up in the middle of the night to find a burglar in her room! She was left unharmed but some of her possessions were gone.

The next day, she filed a claim with her renters insurance company and, although it was still a tedious task, she was so thankful she had the protection in place to reimburse her for the belongings that were taken. 

That’s why renters need to take a hard look at the big what-ifs. What if your possessions are ruined or stolen? What if you’re forced to find a new apartment? If you are a renter, you need renters insurance to reimburse you for damage to your personal property or protect you if someone is injured in your home.

Here’s what the typical renters insurance policy covers:

Personal Property:
Your landlord should have an insurance policy covering the outside of the building and the grounds, but he or she likely will not cover your personal belongings. So if you come home one day to a fire or your toilet overflows and floods your place and ruins your furniture, you will be the one responsible for paying to replace anything that has been damaged. Or maybe you get robbed and the thief steals all your electronics. Again, you will have to pay to replace anything stolen. Renters insurance will cover your personal property against losses from fire, smoke, vandalism, theft, explosion, windstorm and water damage from plumbing.

Liability:
Getting sued can get expensive. Your renters insurance policy protects you if a guest or visitor is injured (or their property damaged) at your place. Liability Protection helps pay your legal defense fees and any damages that are awarded. Without it, everything from your wages and personal property to your checking and savings accounts could be at risk.

Other Stuff:
You can add on other clauses to your renters policy to cover loss of property while traveling or property stolen from other locations such as your car. You can even add Guest Medical Protection, which covers medical expenses if a guest is injured in or around your place.

Like any insurance purchase, you will want to make sure you understand the in’s and out’s on the policy before you apply — and make sure you get the right type of coverage for your current financial situation and goals. If you rent, spend some time to research a renters insurance today and get this type of coverage in place ASAP.

Brittney Castro is a member of the DailyWorth Experts program. Read more about the program here.

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