Most people don’t know it, but renter’s insurance is a policy for renters to protect their personal property from events such as fires, theft, and vandalism. A renter does not own the building, so renter’s insurance does not protect the actual building. Renters include tenants of apartments, condos, and homes.
Renters insurance works like other insurance, by paying a monthly premium. Renters have options based on how much property they need to protect. This is determined by the value of their personal property. Premiums are higher for a higher value of protection. Tenants may add specific items to their policy, like a wedding ring or other valuable. Each item adds an additional cost for the policy. Premiums also vary based on what events the tenant would like to be protected against. An increase in the premium for flood protection is one example.
Most policies have a deductible, like most insurance. This is the amount the renter pays before insurance honors a claim and pays for damage. There is some choice here when picking a policy, but a higher deductible equals a lower monthly premium. For most plans, the premium is less when paid yearly, versus paying monthly smaller amounts.
Renters insurance is beneficial because damage from a fire or theft can cost a lot. At least with a policy costs will be lower. This significantly lessens the burned when damage occurs.