|
| |
How
Much is Renters Insurance a Month and
Why You Need Renters Insurance PART 2
Are
you a tenant looking for renter insurance? Then find out how much is
renters insurance per month and why you need renters insurance for a
worry-free
tenancy in this Part 2 of our Tenant Insurance Guide.
Do You Know
What is Renters Insurance? If No, Click here for Part 1 of this Guide.
How Much is Renters
Insurance Monthly?
If you want a simple one-word answer to this question, it would be
"cheap". Depending on the amount and type of coverage you need, renter
insurance will generally cost between $10 to $25 every month.
Total coverage amount is one major factor that will affect how much
is renters insurance per month. How much coverage amount you will need
depends largely on the combined value of all your possessions. Most
tenants will end up buying renter insurance that covers them from
$20,000 to $30,000.
To arrive at the figure for your amount, add up the value of your
furniture, electronics, computers, clothing, jewelery, household
items, movie discs, books and other personal belongings.
Your
renters insurance deductible also plays an important role when
it
comes to how much is renters insurance. The deductible is simply the
amount of money that you have to pay out of your own pocket before the
insurance cover kicks in.
For
example there was a fire breakout in your rented home and $3,000 worth
of your possessions were destroyed. If your deductible amount is $500,
you will have to pay $500 by yourself and the insurance company will
cut you a check for the remaining $2,500.
In
general the deductible amount starts at $250. By increasing it to $500,
you can save about 10% of your renter insurance a month. A deductible
of $1,000 is likely to get you a discount of 20% or more. Before you
raise the deductible, do make sure that you are able to afford forking
out more of your own money.
As we have mentioned in Part
1 under What is Renters Insurance,
choosing between an actual cash value and replacement cost
insurance will affect how much is renters insurance. While a
replacement cost insurance will usually cost 20 to 30% more, we do
highly recommend it for a more complete protection.
Why You Need Renters
Insurance
You
may think that you don't have enough possessions to bother with renter
insurance but most tenants underestimate the total worth of their
possessions.
A recent study by Insurance Information Institute
uncovered that the average tenant in the United States owns slightly
more than $23,000 worth of possessions. That is one reason why you need
renters insurance.
An even more compelling reason for why you
need renters insurance is because it can protect you from any
financially crippling liability lawsuits that you face as a tenant.
Although
it's not that common for a tenant to be sued for renter liability, the
massive legal fees and damages from a single lawsuit can wipe out your
entire savings and leave you in heavy debt. That's why every tenant
should have at least $100,000 of renters liability cover.
If
you run a higher risk of being sued as a tenant, then you should
consider upping your liability cover to $200,000 or more. This higher
risk group includes people who own dogs, host parties with alcoholic
drinks, have a pool at their rented home or run a home-based business.
Do you want to learn MORE practical must-know facts on
landlord insurance?
Return
from
this How Much is Renters Insurance / Why You Need Renters Insurance
page to our Landlord
House Insurance
guide
|
|
