Protecting Your Stuff from the World

Gregg Dimkoff

Do you rent an apartment, either on- or off-campus? If so, your property is no safer than the drowsiest smoker next door, the crystal meth junkie messing with his 2-liter reactor in the apartment below you, or the windstorm drawn to your apartment building like iron to a magnet. Unless you have renter’s insurance, your possessions are at considerable risk.

You can take solace with the fact that 50-75 percent of renters haven’t protected their property with renter’s insurance, either. Yet for no good reason. Renters who have no property insurance most often cite two reasons: They falsely believe the landlord’s insurance covers them, or that the coverage costs too much.

In fact, a landlord’s policy never covers renters’ property. Got that? Never. Instead, it covers the apartment building. And depending on the value of your property, the annual cost of a renter’s policy usually varies from about $75 to $150. Many national insurance companies allow up to three roommates to share the same policy. Accordingly, a $150 premium shared among three roomies will cost each about $50 a year, or about $4 per month. That’s cheap protection.

You can buy renter’s insurance from the same insurance agent who provides your auto insurance. When you buy two different types of insurance from the same insurance company, a 5-15% discount applies to both. The discount you get on your auto policy will go a long way toward paying your renter’s premium.

Renters’ policies provide a second type of coverage potentially even more valuable than the cost of your property: lawsuit protection. If a visitor to your apartment slips on a puddle of water on the kitchen or bathroom floor, falls, and then needs back surgery, you could face a court award for tens of thousands of dollars. No problem if you have purchased renters’ insurance: Renters’ policies come with $100,000 of liability protection coverage. Your insurance company will defend you in court and pay the court award.

On a happier note, you may already be covered by renters’ insurance without knowing it. When your parents purchased their homeowners’ policy, property up to 10% of the value of their house is covered while at other locations. That nice feature usually covers the property of students while they are away at college as long as they live on-campus and come home during the summers. Some insurers may even cover students who live off-campus. Because this coverage varies from insurer to insurer, it’s best to check with your parents or their insurance agent to verify whether you already have coverage.

Finally, if you buy a policy, it gives you coverage for a year. If you graduate in April, or June, or otherwise move, just notify your agent. You will get a return of the pro-rata share of premiums you paid in advance.