Getting the Most Out of Renters’ Insurance

Renters’ insurance policies provide essential protection for your client’s property, and can offer some benefits. It’s almost always a good idea to have it, whether or not it is a lease requirement. It isn’t too expensive compared to other insurance, typically costing only $300 or $25 per month for $50,000 worth of coverage.

Renters’ Insurance Benefits

There are many other helpful features as well. Most renter’s insurance (personal lines) policies cover damage to your client’s property outside their home. While they may not always cover 100% of the loss amount, this is still a nice perk.

Maximize Coverage for High-priority Losses 

Insurance policies have different coverage limits. Your clients should get more coverage for losses they care about the most. 

Take, for example, a policy with a $50,000 limit. If this covers only $1,000 for jewelry and $2,500 for business equipment, it may not be enough to deal with all of your client’s losses. 

Similarly, a renters’ policy may not cover your client’s total expenses if they work from home and need expensive technology such as a 3-D printer and a powerful computer.

Understanding the difference between replacement value and actual cash value is essential. With real cash value, your client’s policy will pay them the true cash value of their property. With replacement value, they could claim only the amount sufficient to replace their property. 

A new sofa will almost certainly cost more than the actual cash value of a 10-year-old couch. If your client only gets actual cash value with their policy, they will have to pay the difference if they want to purchase a new couch. So although an existing cash value policy will cost less than a replacement value policy, your clients will only get what they pay for.

Of course, you could convince your client to purchase a policy that covers every possible loss. But it would be better for them to buy a basic policy and add additional coverage for items they care about. 

If your client owns expensive jewelry, they can buy “high-value item” coverage. On the other hand, if they own property that depreciates rapidly, they might be better off with a policy that pays replacement value instead of actual cash value.

Prepare the Info Needed for Filing a Claim 

Instruct your client to create an inventory list of the items they own. It would be even better if they could take pictures or videos of their expensive items. It is best to do this before signing up for the insurance policy, as they will need to prove that a) they owned the item at the time of the loss and b) there wasn’t any damage to the item before losing it.

The process is admittedly a bit tedious. But doing so spares your clients the difficulty of getting their carrier to pay out on their claim. Many online tools can help your client create a list of all the properties they own.

Look into Options for Lowering Premiums 

Insurance agents should help their clients find ways to lower their premiums. Renter’s policies typically reward clients with lower premiums if they’ve installed deadbolts on their door or smoke detectors in the apartment. These measures could also help increase their deductibles. 

Your clients could also add renters’ insurance to any other insurance they already have, such as car insurance. It usually comes out much cheaper and could make them eligible for better deals with their insurance carrier.

Using the Benefits from the Policy to Your Advantage

Finally, your clients should know about their policy’s benefits and not hesitate to use them. A good policy offers many benefits besides reimbursing your client for covered losses. For example, they could also pay for damages caused to other people’s property. 

In some cases, insurance may also cover your client’s emergency living expenses if they have to live elsewhere during reparations for the damage to their home. Advise your clients to keep their policy with essential documents so they can access them quickly in an emergency.

About Snyder Specialty

Snyder Specialty, LLC is a New York-based underwriting facility that provides a range of property and liability solutions for personal and commercial lines. Specializing in coastal properties and hard-to-place risks, Snyder Specialty expands your current capabilities with proven solutions for complex risks. Find out more about the company’s range of services by calling (718) 362-8039.