How Much Coverage Do I Need

To get an accurate quote on renters insurance, you’ll first want to have an idea of how much coverage you need. We’ve put together this guide to assist your decision.

Ask Yourself These Questions

To help you determine what kind of coverage you’ll need, ask yourself the following questions:

1. How much is my personal property worth? Most people tend to underestimate the value of their personal belongings. Imagine what it would cost to replace everything you own, from kitchen utensils to shoes. Start thinking about the value of your property.
2. Would I be financially able to replace my belongings if they were stolen or damaged in a fire? Financially, how much could you afford to replace your belongings? Would you be able to replace all, some, or none of them? What kind of a burden would it place on your finances to have to basically start from scratch? Don’t forget that the average person’s belongings are worth over $20,000…could you manage that financially?
3. How would I handle a liability lawsuit? If you were sued for an accident or damage for which you were legally liable, what would you do? Would you be able to pay for adequate legal counsel? Would you be able to absorb a costly judgment against you? Would your assets be jeopardized by a lawsuit? Accidents happen, and lawsuits happen even more frequently. How much would a lawsuit hurt you financially?

Determine Your Renters Insurance Coverage Needs

The best way to do this is to conduct a comprehensive inventory of all of your belongings. Follow these steps:

1. Write down each item, when you bought it and how much it cost, and its present value.
2. Add up all of your items’ total values to get a ballpark estimate of the value of your property.
3. Keep your inventory in a safe place away from your residence. A safe deposit box is a good idea, or maybe even a trusted friend’s home.
4. Think about making a video or photographic inventory of your belongings. This can help substantiate your inventory in the event you have to file a claim.

When to Supplement Your Coverage

In most renters insurance policies, the insurance carrier imposes a dollar cap on certain kinds of property. If you have substantial amounts of this kind of property, consider special coverage:

• Business property
• Stocks or other securities
• Furs and jewelry
• Guns
• Boats and trailers
• Valuable silverware