What affects the price of renter’s insurance?

What type of dog do you have? That’s just one of the many things that can affect the price of your renter’s insurance. Everything from fire and safety devices to the amount of your deductible can change the cost of your policy.

♦ Deductibles

As with any insurance the higher your deductible the lower your premium. A higher deductible can substantially lower the price of your renter’s insurance, but be sure you’ll able to cover the cost of any loss or damage before your insurance coverage kicks in.

♦ Type of Policy

There are two types of renter’s insurance policies and which one you choose will affect the price.

Actual Cash Value: This type of policy pays to replace stolen or damaged items based on their actual worth at the time of the event. The old TV you paid $500 for several years ago isn’t worth $500 today. Even though you might need to spend $500 to replace it with a comparable model, this type of insurance will only pay what it’s worth based on depreciation.

Replacement Value: This type of policy pays you the actual cost it takes to replace the stolen or damaged item. If buying a new comparable TV costs $500, that’s what this policy pays out. This is the more expensive type of coverage.

♦ Amount of Coverage

How much do you need? A policy that covers $10,000 is going to be cheaper than one that covers $20,000. A home inventory can help you determine the right amount for your needs.

♦ Additional Riders

If you have any very expensive items in your home, consider an additional rider to protect them. This is an added expense and will raise your overall premium.

♦ Dangerous Dogs

The breed of dog you own can also affect the price of your insurance. Some potentially aggressive breeds like Rottweilers and Pit Bulls can increase your liability risk and insurers may pass that cost along to you.

♦ Potential Discounts

Talk to your agent about discounts for added fire and safety measures in your home. Just as it is with your auto insurance, the more you do to protect your belongings, the more you can save.

Do you have a monitored fire or burglar alarm?
While having any fire or burglar alarm is a plus, having one that’s linked to a monitoring service lowers your risk and can lower your premium.

Are there fire extinguishers on the premises?
Put fire extinguishers in the hallway and kitchen.

Do you have a sprinkler system?
This isn’t something renters can add, but if your building is already equipped, it can help cut your bill.

Are there dead bolts on all exterior doors?
Make sure you have them on every door. They’re an inexpensive way to add safety to your home and lower your monthly premium.

Do you smoke?
Some companies will consider you a higher risk for accidental home fires if you’re a smoker.