Does A San Jose Renters Insurance Claim Pay Enough To Buy New Property?

Does a San Jose Renters Insurance claim pay enough to buy new property? That’s a great question, and it depends on your policy.  Actually, it specifically depends on one endorsement on your policy.  Right below our Video Guide to California Renters Insurance, we’ll take a look at whether a renters insurance claim in San Jose is likely to pay enough to buy new property!

Replacement Cost Coverage Will Make The Policy Pay Enough To Buy New Property

Replacement cost coverage is the endorsement that allows a claim to pay enough to buy new property.  It’s commonly on most renters insurance policies in California, and you should look at your declarations page right now to make sure that you have replacement cost listed as an endorsement.  You may or may not see a cost beside it, depending on how that particular insurance company breaks up their rates, but what’s important is that you see replacement cost on your policy.

This endorsement is what makes a claim pay enough to buy new property.  Replacement cost coverage is designed to pay the amount of money required to replace your property with a new item of “like kind and quality.”  In other words, you get new property equivalent to what you had.  If you have a couch from a given retailer, you’d be able to go buy a new couch at that retailer of similar kind and quality as what you had before the loss.

If the brand is no longer in existence, don’t worry – Montgomery Wards’ house brand would be replaced with house brand at, say, Wal-Mart. so long as the items are of like kind and quality.

What Happens If I Don’t Have Replacement Cost Coverage?

Without replacement cost coverage, your renters insurance would pay the “actual cash value” of the property that suffered the loss.  The actual cash value is what the thing was worth before it suffered the loss that led to the claim.  If your couch is ten years old, for instance, you’d get the amount of money that your couch was worth today.  To find the actual cash value of something like a couch, go look on Craigslist or a similar site and see what a ten year old couch goes for.  There’s your answer.

This is why replacement cost is so crucial.  Does it cost a few dollars a year?  Sure, but those few dollars a year are the difference between putting your life back together after a loss and having the loss cripple you entirely.  The actual cash value of the contents of your home won’t get you anywhere close to where you were before you had the loss, and you don’t want to buy other peoples’ used property.  You want to replace what you worked hard for with new property.

Can I Afford Replacement Cost Coverage To Make My Renters Insurance Claim Pay Enough To Buy New Property?

Yes, you can.  As a matter of fact, it’s generally assumed that you want the coverage and included as part of the price.  However, you should always ask the question to make sure that the coverage is there.  Some companies call it something different, though the net effect is the same.

Some people seriously consider removing replacement cost from their San Jose Renters Insurance.  This is never a good idea.  You need the coverage, and the difference is just a few dollars a year.  How much difference would that make to the average price of renters insurance in California? Not very much at all! 

The national average price of renters insurance is just $187.00, according to the III. That works out to as little as fifteen dollars per month.  The vast majority of families can budget renters insurance easily at those prices.  

Additionally, it's important to note that renters are at a significantly higher risk of experiencing loss than homeowners.  Renters occupy roughly one third of total housing stock in the country, and yet they are fully fifty percent more likely to experience theft than homeowners, according to the Bureau of Justice Statistics.

It only costs a few dollars a month to protect your family, and this cheap renters insurance is a great way to mitigate the additional risks that come with being a renter.

As you can see, renters insurance in San Jose is inexpensive enough that there is really no reason to remove the replacement cost coverage, especially if you want a claim to pay enough to buy new property – which is really what we all want, ultimately.

What Else Can I Do To Make Sure A Claim Will Pay Enough To Buy New Property?

There are two things that you can do, in addition to making sure you have replacement cost coverage, to make sure a claim will pay enough to buy new property to replace what suffers a loss.  Both are pretty easy, fortunately.

The first thing you can do is to make sure that you have a home inventory.  This is nothing more or less than a listing of all of your stuff and what it cost you to buy it.  You can actually go on the internet and get what it cost you and just put it all in a spreadsheet.  Keep pictures, of course, from each room to help you reassemble the small stuff mentally.  Keep the spreadsheet and pictures somewhere offsite, like one of the many cloud services, and you’ve removed a major headache when it’s time to make a claim.

The second thing you can do is to make sure that you have enough personal property coverage.  If there were a fire, perhaps started by a neighbor, is your personal property limit sufficient to replace everything your entire family owns?  If not, you should consider increasing it to make sure you’re able to recover after a significant loss.

To find out more about how to protect yourself, just call (800)892-4308 or click to get covered - whether you need San Jose renters insurance quotes online or coverage anywhere else!

Effective Coverage offers the nation's only completely mobile platform to quote and purchase renters insurance right from your phone or tablet in just one minute. Get an online renters insurance quote today and protect your family.

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