Helpful Terms

Actual cash value pays what a possession is deemed to be worth at the time of the loss. In other words, if your laptop cost you $1200 two years ago, its value would be less today, an amount calculated by the insurer.

Catastrophes can range from such "typical" events such as fire, vandalism or theft, to things such as damage from frozen pipes or even riots. What often isn't included is damage from flooding, and sewage backups. You will need to purchase separate coverage for these.

Deductible is the amount the insured party pays out-of-pocket before coverage kicks in on a claim.

Loss of Use Policies cover more than lost property. For example, they also provide payment for living expenses if you're displaced from your rental for covered events, such as fires.

Liability makes renter’s insurance an even better idea. If somebody comes into your apartment or rented home and trips on a rug, it could create a costly liability issue. Generally, policies include up to $100,000 liability coverage, but experts recommend that you purchase at least $300,000 of protection.

Replacement-cost coverage pays out the equivalent cost of an item, if you were to replace it with a similar product today. Such coverage, because of the higher payout, carries a higher premium.

Rider is a form attached to an insurance policy that alters the policy's coverage, terms, or conditions. Many renters choose to add a flooding/sewer rider, as many companies do not offer that type of coverage in renter's insurance policies.