What to look for when Shopping for Renters Insurance

When you’re shopping for renter’s insurance you need to go into the agent’s office with some knowledge of what to look for and what to expect because they don’t always give you the following facts up front.

1) What items are covered. Don’t be surprised at the time of a claim when certain things aren’t included. Create an item-by-item inventory list with the insurance agent before you commit to the policy.

 2) What items are not covered. Some items such as furs, jewellery, silverware, gold ware, coins, firearms, watercraft including trailers and their contents, and business property require either special coverage, added coverage or a separate specific policy.

 3) Dollar limitations. Most policies have a limit to the value they give to certain items regardless of what you paid for them. Know that limitation and add extra coverage for those special items.

 4) The kinds of damage that are covered. Every kind of damage is not automatically included so be specific on the following: fire and smoke; damage from ice or snow, lightning, windstorm or hail; explosions; damage from heating or cooling systems; water damage from plumbing malfunctions such as pipes bursting from freezing or unexpected breakage caused by appliances; theft or vandalism; falling objects or aircraft and vehicle mishaps.

 5) Coverage off the rented property. Know what personal items are covered when you remove them from your home. These may include bikes, laptops and all personal items left inside your car that need to be replaced if damaged or stolen. Insurance companies differ in their coverage for off property items.

 6) Replacement costs. Make sure your coverage is for replacement costs and not purchase price. If you purchased a Dunkin Fife table twenty years ago for $100, it may cost $700 today and replacement costs would allow you to replace that table regardless of what it costs in today’s market.

 7) Damage to another person’s property. Be sure you are covered for accidental damage or loss to someone else’s property ie: your above ground pool bursts and pours into a neighbour’s basement causing severe damage to their home. You need to know before you erect the pool that your renter’s insurance will cover this damage.

 8) Legal defence costs. You need to protect yourself in the event of liability for damage or loss you caused to someone else’s property. Ie: losing their laptop or having your pool burst and pour into a neighbour’s basement.

 9) Coverage deductible. Understand how this affects both your monthly payments (premium) and a possible claim. High deductibles usually mean low premiums, but it also means more for you to pay in the event of a claim, where low deductibles mean higher premiums but little to nothing to pay out for a claim. Don’t be caught off guard.

 10) Penalty for making a claim. After making a claim, often your premiums will increase for a specified number of years. You need to know exactly what the penalty rate is in advance so you can know whether it’s worth making a small claim for loss or damage.

 11) Acts of God not covered. Specific unusual events are rarely covered and they may include water damage caused by floods or underground water, earthquakes or landslides, or damage caused from nuclear hazard. Some companies will cover these given consideration for geographical location and probability, but usually at a high added on expense.

 12) Business coverage. If you have a business inside the home, you may want to have specific coverage that is not automatically included in renter’s insurance. This may include identity restoration, earthquake damage, increased business property, incidental business liability or increased liability limits.

 13) Discounts. Most insurance companies offer discounts when home renter’s insurance is packaged with automobile insurance.

 Do your research and establish the facts before you commit to a renter’s insurance policy. You want to be confident before you make a claim of what your rights and obligations are. Hindsight is a horrific lesson to learn when you assumed you were covered but weren’t.