If you rent an apartment or house, you need renters insurance.

Published March 21, 2017

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By GORETE CADIEUX

Sylvia Group Account Executive

Early this past Christmas morning, fire swept through an apartment building in Boston's North End. Because the building's tenants were spending the holiday away with family, none of them were injured, but the building and its contents were a total loss, the cost estimated at more than $4 million. The landlord had property coverage, but at least some of the tenants did not have renters insurance. And, as those tenants soon learned, the landlord's property insurance covered only the building — not the renters' possessions. 

Friends of the displaced tenants rallied with GoFundMe sites, but, generous as the donations were, they didn't cover the full amount of the loss. Payment for new clothes, electronics, furniture, appliances and other possessions came largely out of the renters' pockets.

Renters insurance would have paid for most, if not all, of their lost possessions. For about $100 in annual premium, the tenants could have purchased a policy covering $15,000 in personal property and $500,000 in liability. That, anyone who lived in that now-demolished North End building would agree, would have been a good investment.

Requirement and responsibility

Some landlords require tenants to purchase renters insurance, primarily to protect the owner against potential lawsuits. In fact, Sylvia Group advises landlords to do just that. (If you're a landlord, here are 5 Reasons Why You Should Require Renters Insurance in the Lease.) 

But many landlords do not require renters insurance, and because many renters wrongly assume that their personal belongings are covered under the owners' policy, tenants frequently are unnecessarily vulnerable to loss. 

If fire, water, or vandalism damages the home or apartment you rent, your personal belongings are not covered by your landlord’s policy. For coverage of your own possessions, you need renters insurance.

What renters insurance covers

Renters insurance provides many of the benefits of homeowners insurance, including coverage of possessions and liability. It also extends beyond your home or apartment when you're traveling, covering property that is stolen from your car or hotel room, as well as possessions lost or damaged anywhere else.

So, what's covered? 

  Covered possessions ...

          ... for loss caused by

  • Electronics
  • Furniture
  • Appliances
  • Clothes
  • Jewelry (limited coverage)
  • Fire or smoke
  • Windstorm
  • Lightning
  • Theft
  • Vandalism
  • Water (except flood)

In addition, your policy may provide for reimbursement for living expenses if your rental home becomes uninhabitable.

How much you receive to cover the cost of replacing lost or irreparably damaged possessions depends on whether your policy is for replacement cost value (RCV) or actual cash value (ACV), which is based on purchase price minus depreciation. At Sylvia Group, we offer only coverage that insures property for replacement cost value. RCV costs slighthly more than ACV, but the value it provides is much greater, enabling you to replace past purchases at current prices.

Renters insurance also covers personal liability:

  • in a lawsuit resulting from property damage or bodily injury
  • for paid medical expenses incurred by injured guests.

Additional coverage and discounts

Because standard renters insurance doesn't provide full coverage for some possessions, additional insurance is available to protect valuable items such as jewelry, fine art, cameras, silverware, home computers, musical instruments and firearms.

Meanwhile, some companies offer the opportunity to save on renters insurance by bundling it with an auto policy. An independent insurance agent can work with multiple companies to find the coverage, price and program that are best for you.

Even with a discount, renters insurance may seem like yet another unwanted expense to manage right now, but it could save you a good deal of anguish and great deal of money down the road. While it may be one purchase you hope you'll never use, simply achieving the peace of mind that comes from protecting what you own will make renters insurance well worth the relatively modest price. 

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About Gorete Cadieux and Sylvia GroupGorete_2009_cropped.jpg

With more than three decades of experience serving the personal insurance needs of Sylvia Group clients, Gorete Cadieux works with multiple companies to find the best available coverage at a price that makes the most sense for your budget. She takes a consultative approach to working with clients, enabling them to make informed, educated decisions about their insurance policies. Gorete also specializes in coastal insurance, helping homeowners with the challenges of protecting property along Massachusetts' SouthCoast and other waterfront areas.

Sylvia Group helps businesses and individuals protect their future by designing insurance, benefits and financial planning programs. We’re a third-generation, locally owned agency known for our commitment to our clients and our community, as well for our industry expertise. Founded in New Bedford, MA, in 1950, headquartered in neighboring Dartmouth, and serving businesses and individuals throughout Massachusetts, Rhode Island and beyond, Sylvia Group is certified as a Woman Owned Business Enterprise with the Massachusetts Supplier Diversity Office and has the distinction of being the first six-time recipient of the Five Star designation awarded by the Massachusetts Association of Insurance Agents (MAIA) for all-around agency excellence. 

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