Cheap Renters Insurance

A renter's insurance, or hazard insurance, policy covers content losses of the home due to theft, as well as liability insurance for accidents that may happen inside the home. Some apartment companies require their tenants to have renter's insurance.

Renters insurance is something that is overlooked by a great number of first-time renters, especially young people -- and this is the group that often needs insurance the most, since they don't have funds to cover unexpected expenses to replace their belongings. For a few hundred dollars per year, your belongings can be protected from theft, fire, or other damages. Renters make a payment, called a premium, once or twice per year, and this is good for thousands of dollars of insurance coverage.

Comparing quotes and fine print is something that insurance seekers should always do. The right renter's insurance policy will cover almost all of your valuables from damages resulting from flood, fire, or even electric shock, but insurance policies do differ, so a little research is required to verify exact terms. The bottom line, though, is that every renter should have some level of insurance, if only to cover living expenses in the event that his or her home is destroyed.

Renter's insurance is usually significantly cheaper than normal homeowners insurance, because it only covers the renter's belongings and not the structure itself. To obtain the cheapest insurance, get quotes from every insurance company that services the area you'll be living in. Some companies, such as Geico, offer great discounts for security features like sprinkler systems, smoke alarms, burglar alarms and security guards. Get a couple of renter's insurance quotes and compare policies to find the best for you. Be sure to find out about special discounts - students, members of the military, and other groups often qualify for lower renter's insurance rates.

There are three main types of renter's insurance available. Each type offers progressively more coverage, with correspondingly higher premiums.

Basic Renters Insurance

Basic renter's insurance usually covers the most important things only -- loss of property, and maybe living expenses if the home is destroyed. There are usually limits on coverage amounts for expensive items like jewelry or electronics -- they will only be covered up to a certain amount. Also, with a basic renter's insurance policy, coverage for certain types of flooding or other water damage may be limited.

Broad Form Renters Insurance

Broad form renter's insurance is a slightly more expensive policy that has higher coverage limits for water damage, damage from power outages, and loss of possessions. Details vary depending on the policy, but in general you can expect a broad form policy to cover more stuff with higher limits. A common example is water damage from leaky pipes. Let's say your upstairs neighbor leaves the bathtub running while on vacation, and it leaks through the ceiling and ruins your furniture. This type of thing may not be covered on a basic policy, but is almost always part of broad form renter's insurance.

Comprehensive Renters Insurance

Comprehensive coverage is the most expensive type of renters insurance. Typically, comprehensive coverage has much higher limits on the covered amount for expensive items, and the widest possible definitions for "covered events" -- insurance-speak for whether or not the circumstances surrounding a loss will require the insurance company to reimburse you for the items' value. Continuing with our leaky-upstairs-faucet example, let's say your neighbor leaves the water running and it drips through the ceiling, ruining not only your furniture but also your jewelry and $5,000 computer. This is the sort of thing that's more likely to be covered with comprehensive.

A few final points about renters insurance

• * Remember, your landlord's policy does not cover your possessions whatsoever. You need coverage not only for your possessions, but also for your living expenses in the event that your dwelling is badly damaged or destroyed.
• * Renter's insurance policies are designed for more "traditional" family units -- typically, this means people whose names are on the rental agreement, and who live together indefinitely -- as opposed to short-term or transitory roommates. Roommates, especially those not on the lease, are usually not covered. The people on the lease should have coverage, but roommates may want to get their own coverage to make sure their things are insured.
• * Discounts may be available if you are in the military, if you are a student, or if you switch your auto insurance to the same insurance company as your renter's insurance.