If you rent a home or an apartment, you likely have considered ways to protect the things you own. You may even have purchased a renters insurance policy. Does that mean your renter’s insurance covers theft? It’s a good question. With millions of home larcenies and burglaries reported in the U.S., victims may be unsure about potential recourse when they are the victim of theft. With a renters insurance policy, you’ll likely be able to recoup some or all of the value of your lost items.
What Is Renters Insurance?
Renters insurance is a personal property policy that helps protect your personal belongings ‒ such as electronics, furniture, clothing – from the costs associated with damage or theft. It also includes personal liability coverage to protect you, the renter, from claims related to bodily injury or property damage for which you’re held legally responsible.
For example, imagine that a burglar breaks your apartment window, gains entry, and steals your television. The cost of the television would likely be covered under your renter’s insurance policy, but the cost to repair the window would not. Landlords typically will hold a separate insurance policy to cover structural damage to your dwelling.
Renters insurance also provides coverage for improvements to your rental property. As a renter, you may spend time and money on alterations or improvements to your rental unit. Under a renters policy, you may apply up to 10% of your personal property coverage (higher amounts are available) to repair or replace improvements made by you or acquired at your expense if damaged by a covered loss.
So, Is All My Stuff Covered by My Renters Insurance?
Renters insurance can cover the personal property from a covered loss ‒ up to your policy limit. Before purchasing a policy, some renters take an inventory of their belongings, cataloging the cost to replace each item so they understand the dollar amount of coverage they may need.
Let’s revisit that hypothetical window-smashing burglar who stole your television. Say he also swipes your silverware while prowling the house. While the television would likely be covered under a typical renters insurance policy, the silverware may be subject to special limits. Consider adding Valuable Items Plus Coverage to your renter’s insurance policy to cover these items.
Your renter’s insurance typically covers the belongings of your spouse and kids as well, but not a roommate’s items. If you share your home with a non-relative, he or she may want to consider getting their own renters policy.
Pro Tip: If you store fine arts, precious jewelry, rare collectibles, or other high-cost valuables at home, you may want to consider a Personal Articles Floater in addition to a renters insurance policy.
Will the Full Value of My Items Be Covered?
There are two types of renters insurance coverages that differ based on the way claims payments are determined. They are the replacement cost value (RCV) and the actual cash value (ACV). Should you have a claim, the type of policy you purchase could make a difference in the amount of payout you receive.
- Contents Replacement Cost is coverage in which the insurer pays the amount it would cost to purchase the same or similar item, after a covered loss, minus your deductible. That means the policy would pay $900 to replace a three-year-old television, even though it may now be valued at a substantially lower price than when you bought it new (due to depreciation).
- Actual Cash Value (ACV) is coverage that pays the depreciated value of an item. That three-year-old television may only be worth $125, and reimbursed as such (after your deductible), even though it would cost substantially more to replace the TV.
Another concern when considering the replacement value of your items is your policy deductible. Choosing a lower deductible means you’ll likely receive a larger payout after a claim but will pay a higher premium each year.
How Much Does Renters Insurance Cost?
In general, a renters insurance policy offers broad coverage at a low cost. A typical policy premium falls between $15 and $30 per month, depending on the location and size of your rental, as well as the value of your possessions.1 Talk to your local independent agent or Travelers representative for guidance on your coverage needs.
What Happens if My Stuff Is Stolen While Traveling or Away From Home?
Renters insurance can protect your personal belongings from theft, whether you’re at home, on vacation, or driving to your local supermarket. That means a leather briefcase stolen from the trunk of your car while shopping – or from a hotel room while traveling – is protected in a similar manner as a leather briefcase stolen from the home.
However, there could be a limit of 10% if the item is in storage or at another residence. If you’re a college student, you may even be partially covered under your parent’s or guardian’s policy, so long as you’re still part of their household. That means a television stolen from your student dormitory room or a bicycle bilked from a bike rack may be covered. A typical arrangement will cover losses up to 10% of the parent’s policy limit.2
Pro Tip: While items stolen from the inside of your car may be covered by renters insurance, your car itself is not. You’ll need separate auto comprehensive insurance coverage for that.
Do I Really Need Renter’s Insurance?
Some renters – particularly those just starting out – assuming they don’t own enough to make renters insurance coverage worthwhile. Still, the cost of replacing clothes, furniture, gaming consoles, TVs, computers, and other valuables can easily add up.
Some renters also mistakenly assume their belongings are covered under their landlord’s policy, but that’s often not true. A renters insurance policy is often the most effective way to protect your personal property. An added perk? The peace of mind that comes from knowing your property is protected from theft, whether you’re at home or on the road.