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Exploring Renters Insurance and Condo Insurance

By Pierre Lehu

Once, most apartment renters and condo owners never considered buying homeowners-type insurance to protect their valuables. Now, however, renters insurance or condo insurance on the contents of your apartment or townhouse is a requirement that many landlords and condo associations enforce.

Consider your insurance risk

You might think, "I'm super careful with my stuff and the way I live, so do I really need renters insurance?" Well, you have two types of risks to consider: loss and liability. (While the risks are generally small, so generally are the premiums — the cost of insurance coverage that you pay.)

So what are your risks?

  • Loss: In addition to fire and flood damage, high winds — like a tornado or hurricane — can wreak havoc. And if your apartment is burglarized, all your valuables could disappear. Or, you might have a wide variety of electronic equipment that needs to come in contact with only a little bit of water to become worthless.

    Think that because you live on the 10th floor you're immune from floods? If you have neighbors with plumbing living above you, the potential for a flood always exists, especially if there's a fire because the firefighters will spray hundreds of gallons of water that will soak the apartments several floors below where the fire was.

  • Liability: If someone, especially someone you don't know well, like a painter or electrician, were to trip and fall or get injured in some other way in your apartment or condo, you could get sued and lose a great deal of money. Another costly liability can come if you have a dog, as people have successfully sued for hundreds of thousands of dollars after being bitten.

Inventory your valuables for insurance

Whether or not you have insurance yet, make an inventory of all your belongings. While you're making this list, take pictures of anything that's valuable, including electronics like computers and flat screen TVs, jewelry, expensive china, glassware and silver, family heirlooms that have value as antiques, and collectibles because those pictures will be useful as evidence if you go ahead and get insurance.

Some insurance companies have an online digital wallet where you can store these pictures, just in case the computer where you download them gets damaged or stolen.

On your inventory list, include a column for what the replacement cost of each item would be. For your clothes, just make a rough estimate, unless you're a fashionista with 25 pairs of $400 shoes. When you add it all up, you'll have an idea of what you could lose were there to be a fire or flood in your apartment or building.

The cost of apartment insurance

Apartment insurance is generally low cost, in the range of $10 to $20 a month, unless you really have a lot of valuables or live in a high crime area. You can also get a good rate if you already have insurance, say for your car, and you bundle the policies with the same company. If you don't have a relationship with an insurance company, there are websites that will allow you to compare the costs from different companies such as Renters Insurance.

When considering the cost of insurance payments, always think about how much it would cost you if you were to suffer property loss or get sued without being covered by insurance.

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