All it takes is a fire, a busted pipe, or even a leaky hot water heater to destroy the things you worked so hard to buy. (Or worked so hard to shlep from your parents' house. Whatever.) And don't forget about burglars. Renters insurance costs less than your Netflix subscription. Here's how to be a grown up.

This is for you: If you're renting.

Hands-on time: Less than 30 minutes, unless you get a separate quote from every company that offers coverage

Total time: From a couple of hours to a couple of days, depending on when you pay the premium

Cost: Depends on how much coverage you want and where you live. The average annual renters insurance premium in the U.S. in 2007 was $182, or just over $15 a month, but state averages varied (North Dakota: $112; Mississippi: $250). If you have roommates, split the bill.

What you'll need:
Your date of birth and possibly your Social Security number
Your address
Information about your home, such as:

• When it was built
• How many units or people live in the building
• How close the nearest fire hydrant is (really)
• Approximate square footage
• The number of bedrooms, bathrooms, fireplaces, stories
• Whether it has a garage
• Whether it has a security system
• What kind of pet(s) you have
• A general idea of how much it would cost you to replace all your things. Clueless? Try this calculator to ballpark it, or get on the phone with an agent. (See below.)

What to do:

You can get multiple quotes for renters insurance, but it's probably going to require you to field sales pitches from a few different companies. Example: Visit NetQuote.com.

• Enter your zip code and select "Renters Insurance."


• Fill in your information to request quotes.


• You will most likely reach a page that lists companies but not quotes-the agents will email or call you with quotes to follow up. It's not a bad way to get a lot of information at once, but it can be annoying.

If you have questions and you'd rather talk to a live agent, you can go directly to a company for a quote. All the major players are in this game: Allstate, Geico, The Hartford, Liberty Mutual, Nationwide, Progressive, State Farm, Travelers, USAA, etc.

What you should know:

• You want replacement cost coverage if you can get it, not actual cash value coverage. What's the difference? Replacement cost coverage will pay to replace your stuff; Actual cash value will just pay what your things were worth when they were destroyed (translation: what you'd have gotten for them on eBay). Replacement cost coverage is more expensive, but worth it.


• Liability protection covers you if someone gets hurt on your property-slips on your front steps, say, or gets bitten by your dog. You're covered for costs, including a judgment against you in court and legal expenses, up to your policy's limit. Experts recommend at least $100,000.


• Floods? Earthquakes? Sorry, they aren't covered. If you live in a place plagued by either or both (hello, California), you'll need a separate policy or a rider.


• Your policy may not cover all of your expensive trinkets. Jewelry, electronics and antiques are usually covered up to a point, but if you've got an extensive collection, the standard amounts may not be enough. Ask how much coverage you'll get, and if you think you might be close (or way over), ask about a separate rider. (Limits vary by policy, but $1,500 for jewelry and furs and $2,500 for silverware and goldware is typical.)

You may be able to lower your premium if you do some of the following:

• Choose a higher deductible. Don't go with a $500 deductible unless you have no money at your disposal in case of emergency. (In which case, don't you need an emergency fund?Here's how to start one.) Otherwise, go for $1000 or higher-whatever you can afford if you have to make a claim.


• Get a nice dog. Or at least be aware that insurance companies may be wary of your hound if it's a breed often collared get it? — for attacks on people. Breeds that might sound an alarm: Chow, Doberman, German Shepherd, Pit Bull, Rottweiler, Wolf Hybrid, or any combination of these breeds.


• Buy a smoke alarm. Or a burglar alarm. Or a fire extinguisher. Many companies offer discounts for protective devices.


• Buy from the same company that insures your car. You might be able to get what's called a "multiline discount."


• Age. Over age 55? Senior discounts aren't just for the movies.

Get enough coverage. If a meteor flattened your home (and everything in it), how much money would you need to replace it all? It might be more than you think. Take a few minutes to estimate how much you'd need to replace these items:

• Clothes
• Furniture
• Electronics (televisions, DVD players, computers, printers, software, game and sound systems)
• Kitchenware
• Jewelry
• Appliances (vacuum cleaner, air conditioner, toaster, etc.)
• Collections (tools, china, art, etc.)
• Large items (musical instruments, sports equipment, etc.)

Now round up. Most people need at least $20,000 of coverage, but it's probably not going to cost you much more to double that. Talk to the agent about the differences in price among coverage levels.

Pay for it. Many agents have the ability to take a check over the phone, at which point, the policy is active immediately, or it may go into effect at midnight. You might also use a credit or debit card to pay for the policy. Once you've made the payment, the policy is binding.

Take a home inventory. If you ever have to use your renters insurance policy, you'll need some kind of proof of what you owned. Try a video inventory to catalog your stuff.

To learn more:
Everything You'll Ever Need to Know About Renters Insurance (LearnVest)
The Basics of Renters Insurance (MSN Money)

Who helped: Kip Diggs, spokesperson for State Farm Insurance, and Jeanne Salvatore at the Insurance Information Institute.

Did you do it? Tell us what worked or share other tips in the comments below.


Articles on Bundle are intended as suggestions only. Your personal circumstances may require you to take different steps or to seek the advice of a financial professional. For more about what we do (and don't) do, read our Terms of Use.



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