College students need renter’s insurance

Wednesday, July 12, 2017

As college students and their parents shop for new things to take to college, hopefully renter’s insurance is on the shopping list, too.

College students around the state are gearing up to move into their new home away from home. Students will bring a number of items from home, as well as purchase new things for their dorm room or apartment. These investments need to be covered by a renter’s insurance policy, said Cindy Clampet, Oklahoma State University Cooperative Extension family resource management assistant specialist.

“Renters insurance is just as important as text books for college students,” Clampet said. “Many of today’s young adults have a multitude of electronic equipment with them when they arrive at college, including laptops, cell phones, televisions, printers, scanners, iPods, DVD players and the list goes on. These electronics, coupled with furniture, clothing and other household items add up to quite an investment. Renter’s insurance helps ensure things can be replaced in the event of a fire, theft or weather-related disaster.”

Renters face the same risk homeowners have of losing their possessions. The landlord of the rental property has insurance on the structure itself, but that policy will not cover the renter’s belongings. The same is true for students living in campus housing.

Clampet said there are several types of residential insurance policies, but keep in mind that if you live in an area prone to flooding or earthquakes, a separate policy or rider is needed.

“When considering your options for renter’s insurance, be sure to check the policy to see if it offers actual cash value or replacement cost coverage for your belongings,” she said. “As the name implies, actual cash value will only pay what your property is worth at the time it was damaged or stolen. For example, if you bought a television five years ago for $500, it wouldn’t be worth near that price today. Even though you would probably spend another $500 or more to replace a TV, your insurance company will only pay what the old one was worth, minus the deductible.”

However, replacement cost coverage will pay what it actually costs to replace the items that were stolen or damaged, minus the deductible. Replacement cost coverage will cost more in premiums, but will pay out more in the event you need to file a claim.

“Be sure to let your insurance agent know about items that are particularly valuable, including jewelry, antiques or electronics,” Clampet said. “These may be covered only up to a certain amount. If you own items that are unusually expensive, such as a piece of jewelry, you may want to purchase a separate rider.”

To help ensure you are properly compensated for any belongings you lose in a fire, storm or other disaster, inventory all your personal belongings. List each item, its value and the serial number. It is a good idea to take pictures of items or even videotape the entire room. Keep a copy of photos and/or videos separate from your residence. It also is a good idea to keep receipts in a fireproof safe or lockbox, or scan them and keep them on a network drive on your computer. Burn those files to a CD and keep them with your photos and/or videos.

If your apartment, condominium or rental house becomes unlivable due to a storm, fire, broken water pipe or other reason covered by your policy, your insurance will cover your additional reasonable living expenses. This generally means paying for you to live elsewhere.

“This type of coverage usually is limited to about 30 percent to 50 percent of the total value of the policy,” she said. “If you’re insured for $50,000, your additional living expenses will be covered from $15,000 to $25,000, depending on your policy.”

Just like any other type of homeowner’s insurance policies, the premiums on renter’s insurance will depend on a variety of factors, including where you live, the amount of the deductible, the insurance company and other additional coverage you may need. In general, a renter’s policy is relatively inexpensive.

“Check your own existing policy to see if the student’s belongings could be covered that way. In the event of a disaster, all of the time and effort you have put into finding a policy will pay off,” Clampet said.