While choosing to have renters insurance is a smart option for any urban dweller, it's also important to make sure you have the right coverage should you need it. NY1's Jill Urban filed the following report.
Many New York City renters pay a fortune each month and then many skimp or don’t bother to pay for renters insurance -- the one relatively inexpensive add-on that could prevent great misfortune down the line.
Jeff Schneider of Gotham Brokerage Company says a renters insurance policy can cost as little as $100 to $200 a year for basic coverage, yet many fail to get it and, often, those who do have it don’t have enough. So he says it’s key to ask the right questions to make sure your policy has you totally covered.
First, don’t assume your policy covers everything in your home.
"There are limitations on certain classes like jewelry, fur and silverware. If you work from your apartment, there can be restrictions on business related property and business related liability as well," explains Schneider.
Also, some policies cover property when it is outside the home, so you need to find out first if your policy includes that or not.
Insurance also kicks in after certain perils like theft, fire, or bursting pipes. But a lot of things are not included, so it’s important to understand what circumstances are covered. For example, flood insurance caused by excessive rainfall or rising water is a separate policy. So if you live in a house with a sump pump or in a basement apartment, you may want to ask about flood insurance.
Another big mistake is people don’t have enough liability coverage.
"Liability coverage which protects you if someone falls in the apartment and sues you or if you are responsible for your bathroom or sink flooding the apartment below you. Liability coverage is relatively inexpensive so the difference between minimal coverage and much higher limits can be $30 and $40 a year," says Schneider.
If you are renting with a roommate, you can both be on the same policy.
Also, if you have a dog, your liability coverage should cover you if Fido bites a neighbor, but some breeds generally are not eligible for coverage, so ask first.
Lastly, when purchasing insurance, take an informal inventory of your home. Make sure you understand the full value of your belongings because if they ever need to be replaced, you don’t want to sell yourself short.