Table Of ContentRenters
Insurance
How to Get the Best
Coverage at the Best Price
When Someone Else Owns
the Place Where You Live
SILVER LAKE PUBLISHING
LOS ANGELES, CA ABERDEEN, WA
Renters Insurance
How to Get the Best Coverage at the Best
Price When Someone Else Owns the Place
Where You Live
First edition, second printing 2004
Copyright © 2002 by Silver Lake
Publishing
Silver Lake Publishing
101 West Tenth Street
Aberdeen, WA 98520
For a list of other publications or for more
information from Silver Lake Publishing,
please call 1.360.532.5758. Find our
Web site at www.silverlakepub.com.
All rights reserved. No part of this book
may be reproduced, stored in a retrieval
system or transcribed in any form or by
any means (electronic, mechanical, pho-
tocopy, recording or otherwise) without
the prior written permission of Silver Lake
Publishing.
The Silver Lake Editors
Renters Insurance
Includes index.
Pages: 250
ISBN: 1-56343-767-8
Printed in the United States of America.
ACKNOWLEDGMENTS
The Silver Lake Editors who have contributed to
this book are Kristin Loberg, Christina Schlank, Steven
Son, Megan Thorpe and James Walsh.
This is the 10th title in Silver Lake Publishing’s series
of books dealing with risk and insurance issues that
face people living in the United States and other de-
veloped countries. Throughout this book, we refer to
insurance policy forms and legal decisions from the
United States—but the spirit of the discussion about
risk and insurance can apply beyond the jurisdiction
of the courts cited.
Some of the insurance policy language referenced
in this book has been developed by the New York-
based ISO Properties. ISO policy terms are updated
and modified regularly. Our references to the terms
are intended solely to illustrate common issues and
disputes. You may need to consult with a profes-
sional advisor before making decisions about spe-
cific insurance policies.
This book is intended to make the concepts and theo-
ries of renters insurance and “broad theft” coverage
understandable to consumers. The Silver Lake Editors
welcome any feedback. Please call us at
1.360.532.5758 during regular business hours, Pa-
cific time. Or, if you prefer, you can fax us at
1.350.532.5758. Finally, you can visit our Web site
at www.silverlakepub.com.
James Walsh, Publisher
CONTENTS
CHAPTER 1
Why You Need
Renters Insurance 1
CHAPTER 2
The Mechanics of a
Renters Policy 23
CHAPTER 3
How Much Are You Worth? 53
CHAPTER 4
Liability On Your Part 91
CHAPTER 5
Important Definitions 121
CHAPTER 6
When Disaster Strikes 153
CHAPTER 7
How To Get Coverage and
How to Make a Claim 173
CHAPTER 8
Umbrella Coverage’s
Saving Grace 199
TABLE OF
T A B L E O F C O N T E N T S
CHAPTER 9
Odds and Ends to Renting 219
INDEX 224457
C H A P T E R 1
1
WHY YOU NEED
RENTERS
INSURANCE
Risk is a part of everyday life. Most people—espe-
cially young people—avoid thinking about risk until
something bad happens. The what-ifs get left be-
hind as we worry about more urgent and pressing
problems like work, family and money.
Although bad things happen to good people, many
would rather bank on the false idea that nothing
bad will happen to them, than plan for misfortune
and disaster.
Most would rather put off worrying about what could
happen, and instead, focus on the now and what is
happening.
But truth is, you never know what could happen that
could wipe you out financially. Aside from health
and auto issues, other common problems often re-
late to where we live. Nationwide, close to 68 per-
cent of Americans own homes; the other 32 percent
rent.1 In cities, those numbers are almost reversed:
1
CHAPTER
W H Y Y O U N E E D R E N T E R S I N S U R A N C E
69.8 percent of New Yorkers rent; 61.4 percent of
Los Angelenos rent; 56.2 percent of Chicagoans rent;
and 54.2 percent of Houstoners rent. Renting is easier
than owning a home because you don’t have to worry
about things like a mortgage, property tax,
homeowners associations and making home improve-
ments. There are benefits to owning a home (as well
as a few pitfalls)…but that’s another book.
The focus of this book is on those who rent, because
even though renters usually find that they don’t have
to pay for maintenance, garbage removal, utilities and
water, etc., they may find themselves responsible for,
well, some bad luck. It doesn’t matter whether you’re
renting a town home, a condominium, a bachelor
pad, a single-family detached home or a 5,000 square
foot penthouse.
You could return from a business trip and find that
everything you owned has been burned by a fire.
You could leave the bathtub running for too long
and flood your apartment, as well as two units be-
low you. You could be sued by your favorite FedEx
delivery man for causing him to slip and fall be-
cause he didn’t see those boxes you left out in the
hallway.
Ask yourself, can I afford to reverse the consequences
of something bad happening? Assume you can’t rely
on anything but your own bank account. Could you
replace all those burned items and pay for living some-
where else until the building is fixed? Could you cover
1
The actual numbers, according to National Multi-Housing
Council and tabulated from the U.S. Census Bureau’s American
Housing Survey for 1999, are 67.7 percent and 32.3 percent.
2
C H A P T E R 1
the damage done to your and your neighbors’ apart-
ments by the bathtub water (including their ruined
personal items)? Could you open your wallet up to
the FedEx guy’s bill for medical payments, pain, suf-
fering, lost wages and negligence? Probably not.
If, however, you could pay as little as $10 a month
and be covered for when the what-ifs happen, you’d
probably do it. Even if you think you’re at low-risk
for having accidents, you can’t immunize yourself from
someone else’s negligence or getting sued for your
own personal liability. And this is why renters insur-
ance is key.
C O M M O N M Y T H S
You don’t have to be renting an historic Victorian in
the city or a spacious co-op in a trendy suburban en-
clave to need some insurance on the place that you
live and the things that you own. And you don’t need
to be an ex-dot.comer, who collected millions be-
fore leaving that world to recline in rented manors
and collect antiques, to need protection from sud-
den losses.
By the time you graduate from college, you already
have enough reason to get some insurance. Although
you may not be “worth” that much because you carry
debt in the form of student loans and credit cards,
you’ve probably accumulated things that can add up
to roughly $30 thousand in replacement value. In
other words, if you were to inventory your personal
belongings and add it all up, that’s what those things
would be worth to you. It may seem like a lot for
someone who is just starting out in life, and who may
not even have a job, but think about all those elec-
3
