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10 Questions to Ask When Buying Renters Insurance

October 18, 2017
Renters

Whether you’ve just found your dream space, a starter apartment, or maybe you’ve been in your current place for a while; renters insurance isn’t necessarily on the top of your mind. It can be easy to get stuck in the mindset of that will never happen to me, but accidents and disasters happen. If you’re looking to take a step in a positive direction to protect yourself, your possessions, and ultimately your finances, you likely have a few questions about buying the right renters insurance plan for you. 

First off, it’s important to note that not all policies are the same. They can cover a wide array of risks depending on your needs and the individual policy itself. Your agent or broker will be able to answer any questions you have, explain exactly what your policy covers, and how much it will cost. 

To get started, here are ten questions to ask when your broker when buying renters insurance.

1. What’s covered and what’s not?

It’s important to know the specific amount of coverage you have and which items may require additional insurance. Most policies cover personal belongings, up to your policy’s limits, including furniture, clothing, electronics, and appliances. Creating and updating a home inventory with your personal belongings and their estimated value is important in selecting and maintaining the right plan. On top of coverage for your personal belongings, you may also choose liability coverage. Learn more about it on our product page.

2. What is liability coverage? And how much should I get?

Liability insurance covers damage or injury caused to neighbouring suites and/or tenants. For example, if your bathtub overflows and leaks into the apartment below and causes damage to the unit or its contents, you’re liable. With liability protection you’re covered for replacing and fixing any damage. Liability protection also covers legal costs and court awards up to the limit of your policy. Standard policies typically provide $1,000,000 to $2,000,000 of coverage; how much liability insurance you need is something to discuss with your broker.

3. When am I covered?

You’re covered when you experience loss due to theft, fire, smoke, explosions, and water damage from leaky pipes or overflows. Sewer backup and overland water protection may also be available depending on your location; make sure to check with your broker to confirm what is covered in your policy. And remember, you’ll need to pay your deductible before your coverage kicks in and you can be reimbursed.

4. Are items stolen from my car protected under my policy?

In general, plans include coverage for theft that occurs off-premise. Belongings outside your home have insurance protection similar to the contents inside your home, just as long as the item that was stolen has been added to your policy. However, off-premise coverage may be limited to a percentage of your total coverage, generally 10%. For example, if your plan’s max coverage is $25,000, you’d be covered for up to $2,500. It’s important to note that if items are stolen in an auto break-in, auto coverage will respond, subject to your policy’s limit. It’s best to check with your insurance provider about your policy’s off-premise coverage limit.

5. Will I need additional coverage?

It depends on a case-by-case basis what type of coverage is needed. Some personal items may require additional insurance. Standard policies may limit coverage, for example your family heirloom wedding ring may need an additional jewellery floater to insure to its value. Policies come with a built in limit for jewellery and other coverages.  If you have items that exceed the set limit, you’ll need to add additional protection for those items. Computer equipment may also not be covered if you use it primarily for business. It’s important to assess if you’ll need enhanced coverage options for items that exceed your policy’s limit. For more information, check out our renters insurance coverage calculator and our renters insurance resources.

6. Does my policy cover my roommate(s) too?

Always ask your broker who is covered by your policy. Renters insurance covers spouses and immediate family members in the same household. Some plans allow for a roommate to be added, but they must be specifically named in the policy. It might be a wise idea to take out separate plans as all claims go on your record. Moreover, you never know if things may take a turn for the worse, or one of you moves out.

7. Is my dog covered under my plan?

Always check in with your broker; never assume your furry friend will be covered. Most policies cover liabilities caused by your furry pal, for example if they take a nip at your neighbour. However some policies restrict the breeds of dogs that they’ll insure. Also note that coverage for your pet under your renters insurance policy does not function as pet insurance.

8. What’s the difference between replacement cost and actual cash value coverage?

A replacement cost policy pays for the actual cost of replacing the item that is damaged or stolen, based on the new, similar item. Actual cash value coverage will payout the actual cash value of the item at the time of loss. A renters insurance policy will automatically be based on replacement cost coverage so your items will be replaced with a new version that’s similar.

9. Do I qualify for a discount and how much does renters’ insurance cost?

This is a great question! There are several ways in which you may be eligible for discounts. A monitored alarm system, being three years or more without claims, even your age can save you money. You may also be able to save on monthly fees by choosing a higher deductible. It’s worth asking your broker to help you get the best value. As for the cost of your plan,it varies depending on each individual’s coverage needs. However, most plans are quite affordable and can be as low as $200 per year for the minimum limit. To get a quote on a policy, click here.

10. How do I know how much insurance to get, and how do I buy it?

To determine how much coverage you need, as mentioned earlier, it’s key to create a detailed home inventory of your belongings and their estimated value. Make sure you include all items; the values of your possessions can really add up! You can purchase your renters insurance plan in person at one of eight MIG Insurance locations in Manitoba, or on our website.

Now that you know what questions to ask about renters insurance and maybe even had a few of your questions answered, you can get started on finding the plan that best fits your needs. For more information or to connect with a broker who can guide you through purchasing your plan, visit our Buyer Friendly Renters Insurance Guide.

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