Renters insurance is one of the most misunderstood types of coverage. Many tenants mistakenly believe they don’t need a policy because it isn’t required by law. However, without protection, individuals leave themselves exposed to great financial risk should a disaster occur. Fortunately, the professionals at Mitchell Insurance Agency LLC assist residents of Texas County, MO, select the best products for their needs. To get you started, they share answers to some frequently asked questions on the topic. 

Common Concerns About Renters Insurance

What Does It Cover?

Renters insurance is designed to cover a tenant’s losses in case of a fire, wind, theft, or vandalism. It will provide the funds necessary to repair or replace belongings that are damaged or stolen under these circumstances. It also offers liability protection should a guest become injured while visiting the residence. Instead of having to pay out of pocket for the guest’s medical expenses, the insurance company will take care of these and any legal fees associated with a lawsuit. Moreover, the plan offers compensation for alternative living arrangements if a rental becomes uninhabitable. 

How Does It Work?

If there’s a problem, the amount an insurance company pays out depends on the type of loss and how much coverage you have and the amount of your deductible. Renters can purchase an actual cash value policy, which takes depreciation into account when calculating the costs of reimbursing their items, or a replacement cost policy, which offers the price of replacing their belongings outright. 

How Much Do I Need? 

The amount of protection a tenant needs will depend on their specific financial situation and the value of their possessions. To determine how much coverage to purchase, take inventory of your belongings and replacement costs. It’s also crucial to consider the potential expense of a liability claim if sued for causing another person’s damages. 

Can Roommates Share a Policy? 

Typically, roommates can share a renters insurance policy as long as both tenants are listed on the lease. However, it’s usually recommended that each person get their own plan to ensure coverage limits are set high enough and it doesn’t become a problem if one moves out before the other.                                                                                         

If you have been considering purchasing renters insurance but need more information before you can make an educated decision, the agents at Mitchell Insurance Agency LLC will answer all your questions. With over 65 years of industry experience, they know how to find clients the right policy to match their needs and budget. Contact them at (417) 967-2140 to request a quote, or visit the website for a full list of quality products and solutions they provide.