How NOT to Lose Cash - Buy Renters Insurance

I went to California in 2003 on a business trip. Debbie, Sherry and I had to work on a hospital to sell Term Life Insurance. We looked around for an affordable hotel, but all the rates were rather high and we were going to be in California for at least two (2) weeks or more. Instead of a hotel we found a furnish apartment to rent that had weekly rates. With the short term lease, they required a Renters Insurance policy. The policy would not only cover our contents, but the contents of the apartment and liability in case we caused any damage.

Apartment renters insurance was available through a few companies, so we got quotes from; Geico, Nationwide and State Farm. Nationwide was the cheapest, so we bought a policy and only paid for one month.

While we were staying there Debbie accidentally knocked over the television set that was in her bedroom. After reading the Renters insurance contract, we figured the liability section would cover the cost of a new set or repair without a deductible. The liability section stated that it would provide coverage for bodily injury or property damage which you or an insured under the policy are legally obligated to pay. We called the insurance company and made the claim.

One of the reasons we liked the apartment it had waterbeds, a nice change from your ordinary hotel bed. Unfortunately, a few days later, Sherry was using a knife to peel an apple and stuck the waterbed causing a slight leak. When we had taken out the Renters Insurance policy we asked the agent about an endorsement to cover waterbeds. Luckily the waterbed was repairable, so not only did we have a repair bill, we also had some minor water damage. The coverage was provided under; Optional Endorsements you may request for your policy.

Extension of Liability Coverage Endorsement-Waterbeds
The optional coverage pays for damage to property of others that results from sudden and accidental discharge of water from your waterbed. It does not pay for structural damage which results from a slow, gradual leak, the weight of the waterbed or damage to the waterbed itself.

I am sure glad we looked over the renters insurance contract before we purchased it. Other coverages that were included, but subject to a deductible were:

Personal Property Coverage
This policy will pay for the loss or damage to your property when caused by the perils listed below:
1. Fire and Lightning 2. Windstorm or Hail 3. Explosion 4. Riot or Civil Commotion 5. Aircraft 6. Vehicles 7. Smoke 8. Vandalism or Malicious Mischief 9. Burglary 10. Falling Objects. 11. Weight of ice, snow or sleet 12. Accidental discharge or overflow of water or steam from within a plumbing, heating, air conditioning, or automatic fire protective sprinkler or from within a household appliance. 13. Sudden and accidental tearing apart, cracking, burning, or bulging of a steam or hot water heating system, and air conditioning system, or an appliance for heating water. 14. Freezing of plumbing, heating, and air conditioning systems or automatic fire protective sprinkler system or of a household appliance. 15. Sudden and accidental damage from artificially generated electrical current 16. Volcanic eruption

But always remember to add the Replacement cost endorsement to your renters policy:
The Personal Property Replacement Cost Endorsement:

The Declarations Page will state that under “Additional Coverages” your policy has Replacement Value coverage.

Without acquiring this endorsment your personal property will be subject to Actual Cash Value (ACV) for a covered loss. ACV means the cost to replace an item with another item of similar kind and quality less an allowance for depreciation.


Replacement Cost coverage allows for payment of the loss at full cost to repair or replace the damaged item. Replacement cost is only paid when you purchase the replacement item within 180 days after the loss.

Loss of Use;
If you cannot live in your home as a result of a covered loss and you must temporarily live elsewhere, this coverage pays, for a specified period, for reasonable and necessary extra living expenses you incur over what you would have normally spent to maintain your standard of living if no loss had occurred.


Your Renters Insurance policy will have exclusions, along with other optional endorsements. Please read or review your policy with your insurance agent. We were glad we did. I couldn’t imagine our boss getting the repair bills with our expense reports. Our Renters Insurance policy probably saved our jobs.