Connecticut BBB says a Little Protection Can Go a Long Way
While the majority of homeowners buy insurance for their homes and possessions, just one in three college-aged renters insures their belongings. Industry studies also reveal more than half of all renters fail to buy any insurance protection for their belongings.
When a hurricane, flood, blizzard or fire destroys your home or apartment, the loss can be devastating. Insurance can take some of the sting out of that loss by reimbursing you for the cost of replacing at least some of your possessions.
“Some consumers are under the mistaken impression that their landlord’s policy will cover their losses,” according to Connecticut Better Business Bureau President, Paulette Scarpetti.
Renter’s insurance generally covers property damage or loss caused by theft, fire, vandalism or storms. In addition, most policies include liability coverage, which protects a tenant if someone gets hurt when visiting their home or apartment.
The cost of renter’s insurance is usually lower than homeowner’s insurance because it covers only personal property and liability, not the structure. According to the Connecticut Insurance Department, premiums for renter’s insurance average between $15 and $30 per month depending upon the location and size of the rental unit and the policyholder’s possessions. The amount of the deductible can also affect the cost of premiums.
Two types of renter’s insurance coverage are available:
Actual cash value insurance pays to replace items up to the policy’s limits, minus a deduction for depreciation.
Replacement cost insurance pays the actual cost of replacing your possessions, regardless of depreciation, up to the limits on the policy.
As with any insurance product, BBB advises consumers to get estimates from several companies before buying a policy. College students may be able to get coverage with a rider to their parents’ homeowner’s policy, and other renters can sometimes save by getting coverage from the company that provides their car insurance or other policies.
Connecticut Better Business Bureau advises consumers to read policies carefully and consider the following when buying renter’s insurance:
- Check out the insurance company with BBB. Better Business Bureau Business Reviews are available free at http://www.ct.bbb.org or by calling 203-269-2700.
- Check with the Connecticut Insurance Department for information on how insurers handle claims, as well as information on costs and industry ratings.
- Consider the value of your possessions versus the cost of insurance. Even a college student can have property worth several thousand dollars, such as computers, televisions, furniture, jewelry or small appliances. If you have specific items of high value, you also may need a rider to cover those items.
- Ask what deductibles apply to the policy. Higher deductibles can save you money, but you will have to pay more out of your own pocket to replace belongings.
- Find out whether the policy will cover living costs if you are unable to occupy your current apartment or home.
- Inquire about any exclusions, such as types of property that would not be covered.
- Ask the insurer if they give discounts for burglar alarms, fire extinguishers, sprinkler systems or deadbolts on exterior doors.
- If you are switching insurers, be sure that the new policy is in effect before dropping the old one.
You will find additional consumer tips at http://www.ct.bbb.org.
-Submitted by: Howard Schwartz Executive Communications Director Connecticut Better Business Bureau