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What is Renters' Insurance and Why Do I Need It?

young woman sitting in new apartment on floor

If you’re getting ready to rent an apartment, you’ve probably got a long list of things to do before you move. You’ll want to add “get renters’ insurance” to your to-do list along with ensuring you’ve packed everything you need and signed all the right paperwork. Yes, your landlord has an insurance policy, but it most likely won’t cover your belongings in case of a theft or fire.

Here are six things to consider when you’re ready to purchase a renters policy:

Estimate how much your stuff is worth

When you think about all the things you own, it can be difficult to come up with a total value. That’s why it’s important to have a home inventory detailing the value of your belongings. Completing this checklist (and updating it when you make new purchases) means you’ll have a hard copy to hand to your agent if you ever need to.

Decide between actual cash value and replacement cost

Actual cash value takes depreciation into account when calculating the worth of your belongings. So, if you bought a brand new laptop for $1,000 five years ago, you’ll only be reimbursed for what the laptop is worth in today’s dollars minus depreciation. Say it’s only worth $500 today, then that’s all you’d get.

Replacement cost is a better option: It reimburses you for the item’s original value (or one of similar kind and quality at today’s replacement cost if the item is no longer available) and costs only slightly more than the actual cash value.

Consider earthquakes and other disasters

Depending on where you live, your local insurance agent can tell you more about adding these extra coverages to your renters’ insurance policy.

Choose a deductible

If you’re unfamiliar with a deductible, it’s the amount you pay before your insurance kicks in. The deductible you pick can influence your monthly premium. For example, choosing a smaller deductible can mean paying more in monthly premiums, while a larger deductible can mean lower monthly premiums.

Think about extra protection for any valuables

ERIE offers up to $3,000 worth of coverage for any item stolen for certain categories of personal property. If you own pricey items like jewelry, art, furs, or silverware, you’ll probably want to add a personal valuables endorsement to your renters’ insurance policy to ensure they’re fully covered.

Pick a liability limit

Unfortunately, things happen occasionally, and Umbrella Liability Insurance can provide extra liability protection beyond your renter’s policy. A personal umbrella insurance policy offers an additional $1 million in coverage for claims brought against you should something happen to someone while they’re visiting your home.1

Protection for wherever you call home

Finally, remember that your local insurance agent is always there to help you get the right renters’ insurance policy at the right price.

What’s even better? Purchasing both a renters’ and an auto policy can qualify you for a multi-policy discount. In some cases, the discount actually pays for the renters’ policy.2

ERIE® insurance products and services are provided by one or more of the following insurers: Erie Insurance Exchange, Erie Insurance Company, Erie Insurance Property & Casualty Company, Flagship City Insurance Company and Erie Family Life Insurance Company (home offices: Erie, Pennsylvania) or Erie Insurance Company of New York (home office: Rochester, New York).  The companies within the Erie Insurance Group are not licensed to operate in all states. Refer to the company licensure and states of operation information.

The insurance products and rates, if applicable, described in this blog are in effect as of January 2024 and may be changed at any time. 

Insurance products are subject to terms, conditions and exclusions not described in this blog. The policy contains the specific details of the coverages, terms, conditions and exclusions. 

The insurance products and services described in this blog are not offered in all states.  ERIE life insurance and annuity products are not available in New York.  ERIE Medicare supplement products are not available in the District of Columbia or New York.  ERIE long term care products are not available in the District of Columbia and New York. 

Eligibility will be determined at the time of application based upon applicable underwriting guidelines and rules in effect at that time.

Your ERIE agent can offer you practical guidance and answer questions you may have before you buy.