How much renters insurance do you need?
The right amount of renters insurance depends on your particular circumstances. As you try to determine how much coverage you need, be sure to consider the following factors:
The value of your belongings: Create an inventory of the items in your apartment, making special note of your more expensive belongings.[2] You’ll need more coverage if you own a lot of expensive electronics and jewelry than someone who doesn’t.
Liability risks: If you entertain regularly and have frequent visitors, you have a higher liability risk and should consider a policy with more liability coverage.
Safety and security of your rental unit: Less coverage may suffice if you live in a newly renovated rental property with safety features, such as fire extinguishers and smoke detectors.
Your area’s crime rates: If your rental is in an area with high crime, you’ll likely need higher coverage limits than if it were in a safer neighborhood with low crime rates.
The cost of temporary housing where you live: Consider increasing the amount of coverage if you live in an area with expensive rental rates.
How much personal property coverage do you need?
A landlord insurance policy won’t cover your damaged belongings after an unexpected event. You’ll need your own personal property coverage for your personal items. This includes clothing, electronics, appliances, jewelry, and anything else you own.
You should perform a home inventory to figure out how much personal property coverage you need to protect your items. Make a list of your personal items, including their age, how much you paid for them, and their current value. You may also document your belongings through pictures and videos.
How much renters liability coverage do you need?
Renters liability insurance may kick in if someone sustains an injury on your rental property or if you damage someone else’s belongings. For example, if your friend comes over for dinner and slips on your wet floor, your liability coverage can help cover their medical bills.
If you have a lot of assets that a lawsuit would potentially expose, you’ll likely benefit from having a higher amount of coverage than a renter who doesn’t own much. Consider your net worth when determining how much renters liability insurance you need.
How much loss of use coverage do you need?
Loss of use coverage can pay for your living expenses if a fire or other unforeseen event forces you out of your rental. It can reimburse you for hotel accommodations, meals, and other additional expenses.
If you live somewhere with a higher risk of natural disasters, severe weather, or property crime, you may want to increase this coverage amount. Take a look at hotel rental costs in your area to help gauge the right amount you’d need to cover living expenses temporarily.
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