What you should know about renters insurance

If you rent an apartment or a house, you might be wondering if renters insurance is worth the expense. In some cases, you may not have a choice, as more and more landlords require it. The landlord’s insurance policy covers only the building’s structure, not your personal belongings. Renters insurance helps cover the cost of replacing your things if they’re stolen or ruined due to certain “perils,” such as a fire.

What else do you need to know? Read on.

You can get a replacement-cost endorsement on your policy

Without an endorsement, your personal property may be covered only up to its actual cash value, which means the depreciated amount is based on its age and condition.

Say thieves break into your apartment and steal your 5-year-old television. Rather than giving you the amount that a used TV would have sold for on the open market, a replacement-cost endorsement would provide enough to replace it with a new one of similar style and size.

It can help with unexpected expenses

Most renters insurance policies include loss-of-use coverage, which is handy if you can’t reside in or fully use your house or apartment due to fire, water, or other damage. If you must move out while workers repair your home, your insurer will pay for temporary lodging and might also cover some food expenses.

Liability coverage is usually included, too

If someone is injured in your home due to a covered loss, liability coverage can help you get through any resulting legal claims. Your insurance company will investigate the situation, provide legal defense when appropriate, and, if you are found liable, will pay damages up to the policy’s coverage limits.

It may cover you outside of your home, too. If, for example, your daughter hits a home run in her softball game at school and the ball cracks the windshield of someone’s car, renters insurance will typically cover you in any resulting claim.

Its affordability might surprise you

Premiums on most renters insurance policies are quite low—even more so if you sign up with your auto insurer and get a multipolicy discount. Every policy is different, however, so make sure to read yours carefully to know what it covers, what it excludes, and what it will pay for a covered loss.

Q: My condo has a master insurance policy for the entire complex. Do I still need a separate condo insurance policy?

A: The quick answer is yes. The master policy typically insures the building, while homeowners are responsible for their units, including such things as furnishings and flooring. So, get details on your homeowner association’s policy, including the deductible amount, then talk with your insurance agent to determine proper coverage.

Have you experienced a major life event? Go to AAA.com/myaccount to make sure all your AAA policies are up-to-date. For other insurance information, go to AAA.com/insuranceinfo, call (844) 226-3897, or visit your local AAA branch.