Tenant insurance and renters insurance are the same thing, as the tenants are the ones who are doing the renting. As a renter, you have certain responsibilities. Though your landlord is sure to have the place you reside in insured, that does not cover your personal belongings. If there were a fire, per say, you would lose all your stuff, unless you had tenant insurance.

The Basics of Tenant Insurance

For the most part, you want to be sure that you can replace the things you might lose. You can’t replace the sentimental value of things, but losing things, like a computer or television, would be devastating. These items aren’t cheap and would be a strain on most of us to replace. Especially it we are trying to replace all of it at one time. Most insurance companies have to methods for calculating their payout amounts.

One is called Actual Cash Value. That is the value of the item at the time it was lost. So if you bought a TV last year for $600.00, your insurance would only pay you what that TV would be worth today – which is likely considerably less.

Now, the other method is Replacement Cost. That means, they will pay you what it costs to replace the item. So if you lost a Panasonic 42inch flat screen, they will pay you what it costs to replace one of those today.

Check with your insurance company, for some companies just do it one way or the other, while some companies offer both as a choice, as the replacement cost method generally has higher premiums.

Things You Can Do To Lower Your Tenant Insurance Rates

There are some super simple things you can do, to lower the costs of insurance. Often discounts are given if your tenant insurance and your car insurance are with the same company. A sort of group rate, if you will. You can run to the store and pick up a fire extinguisher and a few extra smoke detectors.

If you want to put a little work into it, you can install some deadbolts. Though this one requires you check with the land lord first, as you will be altering the property and he will need keys.

If you want to go the extra mile, insurance companies like security systems. Course, those too will cost you monthly, generally, but the system will also help the landlord, so he may be willing to work with you on the cost of the system.

Some Things Standard Insurance Plans Don’t Cover

We are all pretty aware that the average tenant insurance plan will cover damage by a falling limb through a window, or some flooding due to an abundance of rain. But if you live in an area prone to severe weather patterns, you need to check into how your insurance will deal with those.

Speaking from experience, I live in an area prone to hurricanes. So, a storm may cause a limb to go through the window and rain to ruin my furniture. No problem. But if the storm that cause the limb to fall was a hurricane, now it is classified as hurricane damage and the insurance won’t cover anything. Coverage for hurricane damage is a separate thing, and has to be paid for as such. The same holds true in areas prone to tornadoes, flooding, or earthquakes. So make sure you find out about that when you are setting up your policy.

If you have something of extreme value, that won’t be fully covered either. Most policies have a limit as to how high they will go on an item, so if you have your grandmothers diamond ring, that appraises at $7000.00, and it gets stolen, don’t expect to see that amount of money. If you do own something(s) of great value you will want to look into a separate plan for those items. I am sure your insurance agent will be happy to oblige.

There is a lot to consider. Your budget, what you feel is a necessity to replace, and how worried are you that you might lose it. Many of the questions you can answer yourself, narrowing down what you will have to discuss with the agent.