Why Do I Need a Renters Insurance Policy?

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Content provided courtesy of USAA.

If you think you don't need renters insurance, think about how much damage a leaky washing machine in the apartment above yours or a fire in the unit next door could do to your belongings.

Would you have the savings to replace your TV, iPad®, clothes, pots and pans, and so on? 

Much less expensive than homeowners insurance, renters insurance is a bargain considering the range of coverage it can provide, says Lisa Gaudi, a property and casualty product management director at USAA. 

Renters insurance policies can cost as little as $12 to $15 a month, depending on how much coverage a tenant needs, she adds. 

"For $12 a month, you can cover your personal belongings, and it's going to include coverage for things like fire and theft, windstorms and lightning," Gaudi says. 

Gaudi highlights other reasons to consider renters insurance: 

  • It can include replacement cost coverage. Young renters often think their belongings aren't worth insuring. But some renters insurance policies cover the cost to replace items. That means rather than depreciating an old TV to almost nothing, your policy would compensate you enough to buy a new one.
  • It isn't limited to your residence. Renters insurance policies can cover property loss even off premises. So if your car is broken into and your laptop is stolen, a policy could cover that.
  • It can protect you from lawsuits. Someone slips and falls in your home during a party, your pet injures someone in the park, your kid hits a baseball through a neighbor's window — all of these scenarios can be covered under a renters insurance policy through liability coverage.
  • It can cover damage to your neighbors' property. What if it's your washing machine that leaks through your neighbor's ceiling, or your kitchen fire that fills your neighbor's apartment with smoke? Again, a renters policy that includes liability coverage can come to the rescue.
  • It can help provide peace of mind. Replacing items lost to theft or damaged by fire, flood or other covered events can cost more than people realize. New renters typically have about $20,000 worth of belongings in their homes. Even if no catastrophe befalls you, a policy that costs as much as a pizza per month can help you rest easier.

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