American families understand the importance of protecting their assets and possessions. For a growing number of homeowners and renters, protection plans provide peace of mind that their possessions can be repaired or replaced if the unexpected happens.
For about 37 million Americans, renting a house or apartment is more affordable, and sometimes even preferable, to home ownership. But there are some disadvantages to renting. According to the Bureau of Justice Statistics, renters are 50 percent more likely than homeowners to be robbed. Likewise, the National Fire Protection Association reports that 270 apartment fires break out each day in the United States. While homeowners are required to have insurance against these types of problems, most renters are not. In fact, a survey by Apartments.com found that 67 percent of respondents did not have renters insurance.
Why don’t more renters insure their valuable possessions? Here are three common misconceptions that could be standing in the way of peace of mind.
• “I can’t afford it.” The average renters insurance policy costs less than $200 per year, according to the National Association of Insurance Commissioners (NAIC).
• “I don’t have anything worth protecting.” Clothing, appliances and electronics can all be covered under renters insurance. The cost of replacing your computer, television, smart phone or gaming system will likely be higher than the cost of insuring them.
• “I’m covered by my landlord’s insurance.” Landlords carry insurance to cover structural damage to the building, but it does not cover your personal property. Nor does it protect you from liability for structural damage you might cause.
“Renters insurance is one of those things you hope you never need, but accidents do happen – and it pays to make sure you and your property are fully protected,” said Kathy McDonald, president, Property Solutions at Assurant Specialty Property. “In addition to protecting your possessions, renters insurance can protect you against personal liability, too. If you accidentally start a kitchen fire or flood in the bathroom and it damages your apartment, or a neighbor’s apartment, you’re the one that’s liable, not your landlord.”
Get the Right Coverage
The amount of insurance you need will depend on what you want to protect and the types of hazards you want to safeguard against. Your insurance agent can give you specifics based on your state and the kind of policy you want. Ask questions such as:
• What hazards are included? Do I need a separate policy for specific circumstances?
• Are my roommates covered by the policy?
• What optional coverage is available (such as flood or earthquake coverage)?
• How much liability coverage is provided?
• Will I receive additional living expenses if I have to live elsewhere while my apartment is being repaired?
• Do I need additional coverage for damages or injuries caused by my pet?
• Does my policy cover items stolen or damaged while not on the property (i.e. stolen from your car)?
McDonald recommends making sure you are covered for replacement costs. “If you file a claim without replacement cost coverage, you’ll get paid what the item is worth now, not for the cost of replacing it with a brand new item. It’s definitely worth the investment,” she said.
Learn more and get a quote at www.rentersecurity.com.
Protecting Your Possessions
Whether you are a renter, a homeowner or are just living with one, it’s likely that you have possessions that you care about. Extended service contracts can help you protect your valuable possessions from mechanical failure, breakage and other perils after the manufacturer’s warranty expires.
Gaming systems, televisions, smartphones, tablets, laptops and other electronics are now an important part of everyday life, and you don’t want to be without them for long. But when an electronic device gets damaged or simply breaks down, renters insurance won’t cover it, and the manufacturer’s warranty might not be enough to pay for repair or replacement. Many product warranties only cover parts and labor for up to 90 days after purchase.
“If you’ve invested your hard-earned money into an expensive electronic device, you want to know you can get it repaired quickly,” said Joe Erdeman, president of Assurant Solutions’ extended service protection business. “Extended service contracts provide important coverage for the items you just can’t live without.”
An extended service contract provides for normal wear and tear as well as accidental damage, and provides additional coverage that your renters insurance won’t cover. You get 24/7 customer and technical support, coverage for 100 percent of the parts and labor cost, and assistance from licensed and insured trade professionals.
When looking for an extended service contract, ask yourself these questions.
• What are the terms and conditions of the coverage?
• Does it provide toll-free telephone and/or online access to technical support?
• Who pays for shipping and handling if a product must be returned?
• Does the contract include a “no lemon” policy?
• Does it provide in-home service?
• Does the contract include accidental damage coverage?
Erdeman noted that extended warranties for computers now provide a variety of ways to get support. Online chat and telephone technical support provide services that range from basic troubleshooting to defragging drives, optimizing speed and addressing malfunctioning keys. At any time of the day or night, consumers won’t be left in the dark. Help is always available to provide answers to common questions about computer troubles.
A home inventory is one of the best ways to make sure your property is fully protected. A well-documented list of your possessions will help you get the right amount of coverage to fully protect your valuables. And the information stored in your inventory could help with repair or replacement if you need it. The NAIC recommends taking these steps to create your own home inventory:
• Make a list of your possessions, including jewelry, electronics, fine art, family heirlooms, collections, furniture, toys, CDs, clothing, sports equipment, tools, etc.
• Photograph or videotape each item, and document a brief description including age, purchase price and estimated current value. Remember to open drawers and closets to document what’s inside.
• Attach copies of original sales receipts and/or appraisal documents. Be sure to note model and serial numbers.
• Store your inventory and related documents in a safe, easily accessible place such as a secured online site, a fire-proof box or in a safe deposit box. You may want to share a copy with your insurance provider so he or she can make necessary updates to your coverage.
Review and update your inventory annually and whenever you make a significant purchase.
The NAIC offers a free mobile app that captures and electronically stores images, descriptions, bar codes and serial numbers. You can download the myHOME Scr.APP.book app for iPhone users at the App Store.