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How do you get renters insurance?
As a new renter, I'm dealing with renters insurance for the first time. I'm still not sure whether I'll be required to purchase a policy depending on where I move, but the whole process is foreign to me. How do you get renters insurance and what are the steps along the way?
You're not alone: Renters insurance is a foreign concept to a lot of people. However, it's good to know how to get renters insurance before you're either required to or decide to buy a policy. There are two basic ways to get renters insurance:
- Do the work yourself: Research the basics of renters insurance, compare insurance companies to distinguish rates, estimate your personal property's value, and get a quote (online, over the phone, or in person).
- Work with an independent insurance agent: An independent agent does the heavy lifting for you. It's still important that you take an inventory of your personal property to estimate its value, but your agent will comparison shop several policies so you have options and can choose what's right for you.
The basic gist is that you need to know how much it will cost to replace your personal property so you can purchase the correct amount of coverage.
Then it's your choice whether you want to try to comparison shop on your own by reaching out to different insurers or if you'd like your independent insurance agent to do it for you.
What should your renters insurance policy cover?
Renters insurance covers your personal property and liability exposure. Liability exposure just means the costs associated with any responsibility the insurance company determines you have if someone is injured on your property or you damage property or hurt someone elsewhere.
There are different policy limits for both. Generally, most renters insurance policies cover $25,000 in personal property and $100,000 in liability. However, you can pay for more coverage (or potentially less) if doing so makes sense for your situation.
Coverage limits are something you should discuss with your independent insurance agent. That way, you know you'll have the coverage you need when you need it.
How do you know how much coverage to purchase?
I touched on this above but want to emphasize how important it is to take a personal property inventory. Without doing so, you might underestimate how much coverage you need.
The point is that you need to write down what you have (in terms of personal property that would be covered by a renters insurance policy) and how much it would cost to replace it. That total is how much coverage you should purchase.
Keep in mind that renters insurance just covers personal property. This means that cars or other motor vehicles aren't covered. Expensive artwork or other personal property may not be covered, either. Generally speaking, the following big categories for personal property are covered:
If you want to discuss how much coverage you need in greater detail, your independent insurance agent is a great resource.
How do you get renters insurance quotes?
You can either contact each insurance company directly or you can work with your independent insurance agent to do so for you. The benefit of the independent agent is that they can provide you with multiple quotes without you having to contact multiple companies.
You should do so only after you take an inventory of your personal property so you have a general idea of how much coverage you may want. Or, if you're unsure about what you can get covered and what won't be covered, you can discuss this further with an independent insurance agent.