Last week I was in Laramie, Wyoming helping my daughter move into a new apartment. This afforded me an opportunity to teach my college-student daughter a little bit about renter’s insurance, an often overlooked and misunderstand insurance product. Many college students mistakenly assume that all their “stuff” is still covered under their parents’ homeowners insurance but that is no longer true once they move off campus and into their own apartment.
I found a local independent insurance agent in Laramie and took my daughter to meet the agent and explore the renter’s insurance products they could offer. The agent was professional and thorough as she reviewed the coverages and price for two different renter’s insurance products. While most renter’s insurance products are very similar in terms of their coverages, there were two distinct differences for my daughter to consider in this case. First, one carrier offered only a $500 deductible whereas the other offered a $250 deductible. For a poor college student, a $250 deductible sounds much more manageable than $500. Second, the $250 deductible carrier also offered loss of use coverage for the actual loss sustained up to 12 months, whereas the other carrier offered a fixed limit of $3,000 for loss of use. The agent explained the purpose of the coverage to my daughter: If you’re unable to live in your apartment due to a covered loss such as a fire, this coverage will pay for your alternate living arrangement. My daughter nodded in understanding, and understood the benefit of having 12-month actual loss sustained coverage rather than just a fixed $3,000 which might cover only 4-6 months of living in another apartment while hers was being repaired.
In the end, my daughter selected the renter’s insurance policy with the better coverages (i.e., lower deductible, 12-month actual loss sustained limit for loss of use) even though it was $38 more expensive. Even with these coverage advantages, the entire renter’s insurance policy cost her only $163, or less than $14 per month. Understanding the realities of college living, which is that bad things can happen and property sometimes goes missing, renter’s insurance is a prudent purchase. In fact, many landlords now require tenants to purchase renter’s insurance as a condition of the lease agreement. This is probably more for the liability coverage that is also included in the insurance policy, but it also avoids unpleasant misunderstandings with tenants who may incorrectly think that damage to their “stuff” is covered by the landlord. That’s an expensive bit of ignorance.
The moral of the story is that renter’s insurance is a very affordable insurance product that all renters should purchase. My daughter learned some basic insurance principles (e.g., deductibles, coverage purposes, loss limits) that will serve her well as she becomes an independent adult. Finally, I enjoyed spending a week in the beautiful 70-degree, no-humidity weather of Laramie, Wyoming, 7,200 feet above sea level and nestled in a valley between the Laramie Range Mountains and the Snowy Range Mountains. And yes, the mountain hiking was exquisite.
Hiking along Lookout Trail at the base of the Snowy Mountain Range, 35 miles west of Laramie, Wyoming.
Your humble correspondent hamming it up for the photographer – on the Turtle Rock Trail 15 miles east of Laramie.