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Renters Insurance: Do I Really Need It?

Army Housing in California

Mastering your move and finding a good place for your family to live can take a lot of time and energy, so it’s not surprising that something like renters insurance could be overlooked. However, this small cost could save you big money if something happens to your personal belongings.

What is renters insurance?

Renters insurance is property insurance specifically designed for people who do not own their homes. If disaster strikes in the form of fire, vandalism, theft or any number of other ways, renters insurance means you won’t be stuck paying to replace everything that was lost or damaged.

Whether you live on or off base, in a house, apartment, duplex or townhome, renters insurance, (minus the deductible) typically:

  • Covers the cost of repairing or replacing your personal belongings, or provides you with the cash value of each item lost or destroyed (Reimbursement varies with different policies. Some policies offer reimbursement for the cost of the item minus depreciation. Full replacement value coverage is also available.)
  • Provides continuous coverage as you move your military household goods
  • Covers costs including hotel, meals and laundry if you need to leave your rental during repairs
  • Offers protection against lawsuits if someone is accidentally injured in your rental
  • Covers your belongings even if they’re damaged or stolen outside your rental
  • Covers food spoilage if a power failure results in food loss
  • Provides limited coverage for credit card fraud or check forgery
  • Typically does NOT cover loss or damage from hurricanes, floods, earthquakes, pests and certain dog breeds

There are two forms of renters insurance, broad and comprehensive.

  • Broad form is the more limited and less expensive option. It is also the most common form and usually offers coverage for specific events named in the policy — typically fire, lightning, explosion, smoke, vandalism, theft and water-related damage from utilities. Broad coverage can also provide personal liability protection against lawsuits if someone is accidentally injured in your home. It does not cover floods and earthquakes.
  • Comprehensive form covers everything unless not specifically excluded by the policy. It will probably provide a higher personal liability limit and cost more.

Be sure to understand the details of the coverages, premiums and deductibles offered in the insurance agreement before making any choices. No matter which form you buy, if you own expensive items like jewelry, you may want to purchase additional coverage.

Do I need renters insurance?

Unlike car insurance, renters insurance is not required by law. However, your landlord may require you to have a policy and it is usually a good idea. If you were to lose all of your personal possessions, could you afford to immediately replace them out of your pocket?

Check with your landlord or housing agreement to see what coverage you may already have and determine if additional coverage is necessary. Although your landlord may carry insurance on the property, it probably only covers the building in which you live, not your personal possessions.

If you live in government or installation housing, you may have renters insurance included, or you may only be covered for things damaged or stolen from your quarters. Make sure you understand exactly what the policy covers, as well as any restrictions. Some privatized housing policies only kick in after the dweller’s personal insurance policy has paid out, and only cover losses over $10,000.

How much does renters insurance cost?

Depending on what you plan to insure, coverage is easy to find and may be cheaper than you think. For example, property valued at $30,000 plus $100,000 of personal liability coverage will likely run between $15 and $30 a month, with a deductible less than $500.

Costs are very dependent on your geographic location, credit history, previous claims and deductible – so be sure to shop around and update your coverage annually, or as needed with each move or life event such as marriage, divorce or starting a family.

You can buy renters insurance directly from an insurance company or an insurance agent. Check with your state’s department of insurance for names of insurers in your area. If you have a car or other types of insurance, ask your insurer about renters coverage — you might get a discount for bundling two or more types of policies.

Remember, the total costs for renters insurance, like other insurances, is the cost of the premium (usually paid monthly or annually) plus the deductible if you need to use the insurance coverage in case of an event.

Consider including the amount of your deductible as part of your emergency fund so that it’s available if you need it. In some policies, you may not have to use the deductible for certain policy provisions, such as food spoilage. Be sure to carefully review the policy and check with your insurer if you have any questions.

Insurance tips

Learn more in this Understanding Home and Renters Insurance fact sheet from the Office of Financial Readiness. Like all insurance purchases, do your research before you buy renters insurance. Taking the time to consider your options now can give you peace of mind — and could save you money later.

Another helpful insurance tip is to make an inventory of all your belongings. Having a record of all your belongings helps establish ownership and value and can make it easier for you to be reimbursed for loss or damage whether it happens during a move or while you are renting.

Questions about your move? Contact your Relocation Assistance Program service provider at your local Military and Family Support Center. You can also connect with Military OneSource relocation professionals 24/7/365 from anywhere in the world. Call 800-342-9647, use OCONUS calling options or schedule a live chat.

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