When you’re calculating your monthly budget necessities like rent, utilities, food and transportation probably make it to the top of the list. However, renters insurance is just as important as — and often more affordable than — most of these expenses. Even with the affordability of insurance, many renters go without and leave themselves exposed to a huge financial risk. In this post we outline the cost of buying a policy on any budget.
The amount you pay monthly or annually depends on several factors and can vary slightly between insurance providers. When calculating your premium, things like how much coverage you need, the type of coverage you choose, the amount of your deductible and the location of your rental property are taken into account. Things like type of building, your insurance history, and even distance from a fire hall can also affect your premium.
It’s always important to quote out a policy so you know what’s taken into account before purchasing.
As a rule of thumb, it’s a good idea to opt for more liability coverage since resolving legal issues or paying medical bills can be quite pricey. It’s also a good idea to figure out if you want additional coverage for expensive items like jewelry or your first-edition comic book collection.
Renters insurance policies with MIG Insurance cost as little as $240 per year, a figure that works out to as little as $20 per month for coverage that ranges from $30,000 to $100,000 in contents coverage and $1 million to $2 million in liability coverage. That’s a pretty small investment for a big return. For more information, check out our The Real Cost of Renters Insurance infographic.
When figuring out how much contents coverage to get, it’s a good idea to familiarize yourself with the type of coverage available to renters. All renters insurance policies come with replacement coverage, which will reimburse you for the full cost of buying a new TV of similar quality to the one you lost in a break-in or fire. You can also add a “floater” to cover those expensive items mentioned above. A floater adds an additional level of coverage for pricier items that might not be covered in an average policy. While this kind of coverage will raise your premium slightly, it will ensure you receive the full value for high-end items in the event of a claim.
A deductible is the amount you pay out of pocket if you have to make a claim. Renters insurance deductibles can range from $500 to $1,000 and choosing what you’re willing to pay affects your premium. The higher the deductible, the less you pay each month.
However, if your deductible is $1,000 and your $700 bike gets stolen during a break-in, it probably won’t be worth filing a claim because you’ll be paying more to replace the stolen item. If your deductible is $250 it makes more sense to file. As a renter, you need to find the right balance between the price of your policy and the cost of your deductible.
There’s a policy for every budget, thanks to the flexibility and personalization available with renters insurance. MIG works with major insurance companies and can advise you on the best policy for your needs and price-point.
You can visit our product page or learn more about renters insurance with our Renters Insurance Tools and Resources. Try out our renters insurance calculator to see how much renters insurance you need, or to get a quote, click here to get started now.