Check Your Rental Insurance IQ - Where Do You Stand
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Quiz: What’s your renters insurance IQ?
1. What does renters insurance typically cover?
2. True or False: Renters insurance also covers your belongings when they are outside of your rental home.
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3. Which of the following is usually NOT covered by a standard renters insurance policy?
4. What is a 'deductible' in a renters insurance policy?
5. Renters insurance policies typically include liability coverage. What does this mean?
6. Can the landlord require you to have renters insurance?
7. If you share your rented home with roommates, does your renters insurance policy cover their belongings as well?
8. How does the 'actual cash value' (ACV) differ from 'replacement cost coverage' in renters insurance?
9. In case of a burglary, what should you do first?
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- Covered in as little as 90 seconds
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10. True or False: Renters insurance policies are generally expensive.
Answers
- B: Personal belongings, personal liability, and additional living expenses. Renters insurance typically covers not just your personal belongings but also includes liability coverage in case someone is injured in your rental and additional living expenses if your rental becomes uninhabitable due to a covered peril.
- A: True. Renters insurance often covers your personal belongings even when they are outside of your rental, such as in your car or with you while traveling.
- B: Flood damage to personal property. Standard renters insurance policies usually do not cover flood damage. For this, a separate flood insurance policy is often required.
- C: The amount you must pay out-of-pocket before the insurance covers the remaining costs. A deductible is the amount you agree to pay out-of-pocket for a claim before your insurance coverage kicks in. Lower deductibles typically mean higher premiums, and vice versa.
- D: All of the above. Liability coverage in a renters insurance policy covers legal costs if you're sued for an incident in your rental, medical bills for anyone injured there, and sometimes even accidental damages you cause to neighboring properties.
- A: Yes, always. Landlords can require tenants to have renters insurance as part of the lease agreement. This requirement is legal and increasingly common, as it helps protect the landlord's property and reduces their potential liabilities.
- B: No, they need to have their own policy. Your renters insurance policy typically only covers your belongings and liability. Each roommate generally needs their own policy to cover their own belongings and liability.
- A: ACV reimburses you for what the item is currently worth, while replacement cost coverage pays for a new equivalent item. Actual Cash Value (ACV) takes into account depreciation, paying out only what an item is currently worth, whereas replacement cost coverage reimburses you the amount needed to buy a new, similar item without considering depreciation.
- B: File a police report. In case of a burglary, the first step is to file a police report, as your insurance company will require this documentation to process your claim.
- B: False. Contrary to what many people think, renters insurance is generally not expensive. It offers significant coverage and peace of mind for a relatively low monthly cost.
- Starting From $5/mo
- Most loved renters insurance in America
- Covered in as little as 90 seconds
- Claims paid at record speed
The bottom line
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