by Shannon S. Harwell

Created on: September 09, 2009   Last Updated: September 16, 2009

Even for renters, home is where the heart is. It also happens to be where most of your worldly possessions are kept. This is why renter's insurance is a critical resource to have. The owner of your dwelling likely has insurance protection for the actual structure itself, but what about your own property inside? In the event of a loss or disaster, if you don't have renter's insurance, whatever you may lose is gone forever. It can be very expensive to replace lost items, easily mounting into the thousands from just one incident. Comparatively, renter's insurance protects your property for a low monthly premium that provides either replacement cost or actual value reimbursement depending on the type of policy you select.

Renter's insurance, also known as an HO-4 policy, protects renters and their property from a wide variety of perils, including:

*Fire, smoke, lightning, or explosion damage

*Windstorm, hail, collapse from the weight of ice, snow, or sleet damage

*Aircraft or vehicle damage

*Theft, vandalism, riot, or civil unrest damage or loss

*Electrical, plumbing, or interior water damage or loss

A renter's insurance policy can also be tailor-made to suit one's needs. For example, a policy can include riders or additional provisions to cover damage or loss from earthquakes, hurricanes, floods, and wind damage. This is especially valuable for those living in areas prone to these vulnerabilities.

There are two types of coverages available: those that provide reimbursement to the renter for actual cash value (ACV) and those that provide replacement cost reimbursement. Actual cash value takes into account the current value of lost items (which generally depreciates as assets age) and pays that amount to the policyholder, while replacement cost pays the amount required to replace a like item at its actual current market cost. Unusually valuable or extraordinary items should be covered by a rider as well, including such things as expensive jewelry and antiques. Generally speaking, most policies have a deductible amount which the renter will pay, and the insurance company will pay the balance of the lost items based on the type of coverage the renter has in force.

In the event of a loss, renter's insurance not only covers property, but also helps renters with a place to live if their own residence is unlivable. Liability insurance that protects renters from lawsuits if a visitor is injured in the residence is also generally included in a renter's insurance policy. Various discounts may also be available, such as if a dwelling is equipped with fire and smoke detectors, security systems, and fire extinguishers.

Since home is where the heart is-and where most of your belongings are-renter's insurance is valuable protection to help renters get back on their feet and in their homes when unfortunate losses occur. No homeowner would go without homeowner's protection. Why should renters be any different? Get a renter's insurance policy to protect yourself today so you won't be sorry tomorrow.

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