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Renters Insurance Cost Considerations

Updated on July 14, 2011

Renters Insurance Cost Considerations

When you are taking into consideration buying or have just bought a condo, you will be amazed to find out how renters insurance and homeowners insurance are so different. Obviously, the differences between a condo and a home are apparent, but there are a few significant aspects to think about. Your renters insurance cost will be one of the top points to consider. Owning or renting a condo means that you’re a part of the community inside the condominium complex and part owner in the common areas. Although various condos have their own insurance plan that your condo fees help fund, it is quite likely additional coverage will be required as part of your individual renters insurance policy. If you have particularly high valued items such as artwork, computers, multiple plasma TV’s make sure to inquire about high value contents insurance.  

Make sure that you look at your policy first when you start to consider moving into a condo. When you first purchase a condo unit you will be given a copy of the principle policy, this is the policy that is included for with your condo fees. Your principle policy will clearly let you know what is not covered by the condo group plan, and these left over items will need to be included in your personal policy. Carefully reviewing what the condo group association has mentioned for a deductible is extremely important. You’ll find that dishwasher and washing machine floods will be more typical then other disasters but you will be required to split the deductible with the other condo owners. Varying on the size of your condo community, this may be as little as a couple thousand dollars, or upwards to fifty thousand dollars. If your deductible is unmanageable, you will want to let your private insurer know and ask for options that can help save you from financial debt in the event a claim may have to be made by the association.

High Value Contents Insurance

Contents Insurance

As I mentioned earlier one of the prevalent things that condo owners and renters forget to consider is water damage. Not every contents insurance policy will protect you from damages and losses in the event a neighboring condo in your complex is the cause of your claim. Flood and wind coverage may also not be included, but depending on your location it may be a worthwhile investment to pursue.

When you talk to your insurance provider or real estate agent about contents insurance to cover your assets inside of your new condominium you the chance to choose between two types of coverage. The typical cash value insurance plan is the cheaper option, but the draw backs of that plan need to be given consideration. With the cash value policy you are reimbursed the value of the items that become damaged, minus any depreciation. Since computers, LCD TV’s and other forms of technology are common, this may make replacement intricate due to the depreciation on these types of objects. The best, yet typically more costly, option is a replacement cost policy. When you get a replacement cost policy you’re given the actual cost of replacement. As an example, if your desktop computer is a few years old, your replacement value would be the cost of a current new desktop, where as with the other plan you would receive the cost of the new laptop minus a couple years of depreciation, which can be a considerable loss. All of these factors will vary your renters insurance cost.

Renters Insurance

Since the process of insuring a condo may not be as simple and straight forward as traditional household insurance, finding the right agent to take care of your needs will make it much easier to understand. Having a local realtor can help a great deal as well. They are experts in their field, and are committed to finding not only the perfect condo for you but also help guide you to a contents insurance policy that specifically suits your needs.


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