And if you live with someone who is not a close relative and keep your belongings in their home, you also need to have contents insurance. Even if the other person owns the home, and carries homeowners insurance, their homeowners insurance policy does not include coverage for anyone who is not a ‘close relative’ of the owner. A separate policy for your possessions is a good idea.
Another feature of many policies today is that they provide replacement cost coverage for your goods. If someone breaks into your apartment and steals your plama TV or all your furniture, the insurance company will repay you with the new value of these goods so that you can replace them.
In the past, many policies deducted for the age of the item. For example, if your TV was stolen and it was five years old, the insurance company may say “To replace your TV it will cost $1,600.00 but since your TV was 5 years old and the average life of a TV is 10 years, we will only pay you half or $800.00.”
When shopping for cheap contents insurance, be sure to verify that the policy provides replacement cost coverage.
It pays to read your policy carefully. Most standard home and contents insurance polices cover the standard household goods we all own. But there are many items that have limited coverage with usually either a cap on the maximum amount the insurance company will pay or they may exclude these items all together. Some examples of this are guns, cameras and camera equipment, jewelry, fine arts such as paintings or statues and many other items that would be considered collectables. If you are in doubt, about items that you have that may fall under this area, query your insurance company or agent before committing to the policy.
Most modern contents insurance also includes liability coverage to protect you in case you are sued by someone who claims your unintentional acts or ommissions caused them harm. For example, if you were having a bar-b-que on your apartment’s patio and a neighbor’s child came by and was accidentally burned, your insurance company would cover all the legal costs of defending you if it turned into a lawsuit. And if you had been negligent and the person suing you would win the case, your insurance policy would pay the suit up to the limit of the liability coverage you purchased with your policy.
And if you own a pet, you have another very good reason to have this liability insurance coverage. If you dog would bite someone or some other accident of this type happened because of your pet, your liability coverage would be there to cover the legal issues up to your policy limits.
In today’s sue happy environment, one of the main reasons for carrying liability coverage is not the actual risk of you loosing a lawsuit. Rather, anyone can sue anyone and even frivolous suits still need to be defended and the legal fees can mount up rapidly. Remember that the liability portion of your policy has a limit as to how much they will pay if you lose a suit, but whether you win or lose all the defense costs are also paid by the insurance company in nearly all cases. Even when you find cheap home content insurance these are still coverages that will need to be included.
Do your due diligence when you are shopping for home content insurance or comparing prices on renewal. The more you know about the details of how your insurance policy works, the better off you will be in getting the best coverage for your premium.