If you haven’t bought your own home yet then the place that you live in is probably covered for insurance by your landlord. However, you may still want to invest in renters insurance to help protect the belongings in your home. Is this a necessary expense? Not necessarily but it definitely protects you in case of certain tragedies like a break-in that results in major theft or medical coverage for someone else who is injured when visiting your rental home.

Here are ten important things that you should know about renters insurance when trying to decide whether or not to invest in it:

  1. Third party liability is the major reason people use renters insurance. When people visit you at your home there is always the chance that they may be injured. Another person’s property may be damaged when they bring it to your home. Your landlord’s insurance does not cover these problems but your renter’s insurance will. For example, if something terrible happens and your friend and his rare guitar are both severely damaged in your home then you can get help paying for the expenses using your renters insurance.
  2. Renters insurance protects the valuables that you have in your home. In addition to protecting you from liability when other people are harmed in your home, renters insurance protects your own belongings. Although some types of damage aren’t covered (damage from flooding, for example) most home emergencies that damage your items will result in a payoff to help you replace those items.
  3. Renters insurance covers items that you may take out of the home. For example, your renters insurance can cover your laptop computer so if it gets stolen while you’re out and about then your insurance can help you to replace it.
  4. Renters insurance will help you pay for a new place to live if your place becomes unlivable. If something happens to your apartment and it’s not possible to live there anymore, your renters insurance may pay for up to one year of rental at a comparable property. Your landlord may not be able to help you in a major situation such as the building burning down but your insurance is there for you.
  5. Renters insurance doesn’t have to cost a lot. By choosing a low coverage amount and a high deductible you can generally get a rate for renters insurance that is fair.
  6. It is common for people to get discounts on renters insurance. For example, when you get renters insurance from the same place that you get auto insurance, you may get a discount. With some companies installing protections in the home, such as smoke alarms, helps reduce the cost of your renters insurance.
  7. There are different types of renters insurance. It’s important to know that you have choices when it comes to renters insurance. You may get insurance that just covers your personal property. You may get just third party liability insurance. You may get a combination of those. You may also get additional insurance coverage such as inflation coverage which increases the value of your coverage along with the rate of inflation so that you’re always adequately protected. It pays to shop around and explore all of your options.
  8. There are limitations on this coverage. Many renters insurance policies limit the amount of money that you can get for replacement or loss of high-end items such as fine art, antiques, jewelry and computers. Make sure that you read this part of your policy carefully before signing it. After all, if what you have isn’t properly covered then it’s not financially worth it to get renters insurance.
  9. You may have trouble getting renters insurance if you have a dog. In particular, certain aggressive dog breeds are considered risky and may end up preventing you from getting good renters insurance. Make sure to ask about this when reviewing policy options.
  10. Before choosing your insurance, you’ll want to do a an in-depth home inventory check. This involves going from room to room noting the value of each item in the room. Most people take a photograph of the item and mark the photo with the value of the item. This allows you to see exactly how much coverage you will need. Many people are surprised by the actual value of what they own.