College students are just settling in for the fall semester and renters insurance probably isn't a hot topic. But it's a safeguard worth considering given the smartphones, laptops and other pricey belongings students own these days.
Here's a look at the ins and outs of renters insurance:
Students living in a dorm, sorority or frat house are usually covered as part of their parents' homeowners or renters insurance. But the coverage amount may be limited, in many cases to 10% of the value, so it's a good idea to check with providers about the policy details.
Anyone opting for an off-campus apartment will need to get a separate policy.
Costs will vary depending on location, the type of policy and other factors. But on average consumers pay $176 a year for renters insurance, according to the Insurance Information Institute.
Policies typically provide about $30,000 in coverage, including items stolen from a car. Most policies also include personal liability coverage in case anyone slips and falls in the apartment.
Renters can opt for a cash value policy or a replacement value policy.
A cash value policy pays out the value of the property at the time it was damaged or stolen; a replacement value policy, which costs about 10% more, pays out an amount needed to replace the belongings.
To avoid any complications, it's important to keep a record of the belongings that might need to be replaced. This could be a simple list of items with photographs or even a room-by-room video of the apartment with a voiceover describing the brand and model of significant belongings. The record should be kept in a safe location away from the apartment. Without such a record, agents may interview neighbors or friends to confirm claims for pricey or unusual items.
Note that most renters insurance policies don't cover losses incurred by a flood or an earthquake; coverage for those events can be purchased separately.
For more information, go to:
Insurance Information Institute: www.iii.org
III's Know Your Stuff: www.knowyourstuff.org
National Association of Insurance Commissioners: www.naic.org
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