Lesson 11.5 - Home and Renters Insurance

If your apartment catches on fire and you have renters insurance, the insurance company will likely pay all of these EXCEPT...

• The cost of your hotel room for a week while your apartment is cleaned up

• The cost of replacing any items inside the apartment that completely burned in the fire

• The cost of replacing damaged sections of the roof and any broken windows

• The cost of replacing items ruined by water as firefighters put out the fire

When discussing homeowners or renters insurance, what is a home inventory?

• A list of similar houses or apartments in your price range, should your own home get damaged

• A list of the top ten most valuable items inside your home and their approximate replacement costs

• A list created by the insurance company of what types of damages or accidents are covered in your policy

• A list of all of your possessions inside your home that you create ahead of time in case you ever need to file a claim

What is one way that homeowners insurance differs from renters insurance?

• Homeowners insurance will cover your physical structure (house, condo, etc.), but renters insurance does not

• Homeowners insurance is typically cheaper, because houses are less risky than apartments

• Homeowners insurance will cover car accidents, but renters insurance will not

• Homeowners insurance is completely voluntary, while renters insurance is mandatory

How many coverage bundles are in a standard homeowners insurance plan?

• Three

• Four

• Five

• Six

Your best friend Amelia just moved into her first post-college apartment. When you remind her to get renters insurance she says, "I'm going to pass. I don't have that much stuff, and nothing I have is new anyway, so it's not worth much." Why is her logic flawed?

• Renters insurance is free, so there's no reason not to sign up for it

• In the case of a major burglary or fire, it can cost thousands of dollars to replace all the stolen or damaged items with new ones

• Every state in the country requires renters insurance if you don't own your own home

• A renters insurance policy makes it illegal for your landlord to raise rent more than 5%

Why is the declarations page of a homeowners insurance policy so important?

• It lists all the possessions in your home, in case any of them are damaged or stolen

• It states all of your coverages bundles, limits, premiums, and deductibles in one location

• Through detailed documentation, it lists every type of possible injury, accident, theft, or other emergency that is covered by your plan

• If you do not have a copy of your declarations page with you at the time of an emergency, you cannot file an insurance claim

Patricia bought all new dishes for her apartment when she moved in 8 years ago, spending $75 at the time. She has a renters insurance policy for full replacement value when her apartment is vandalized and most of the dishes are beyond repair. What will her insurance company pay?

• Approximately $15, the current value of 8-year-old used dishware

• A flat rate of $75, because that's what she originally paid

• Whatever the current price is to replace all her broken dishes with ones equally nice to what she owned

• Up to double the original cost, in this case $150 total

Starling's homeowners insurance coverage has a premium of $125/month, a coverage limit of $200,000, and a deductible of $2000. His home is ruined in a tornado, and the replacement cost of the dwelling is $250,000. How much should Starling expect his insurance company to cover?

• $1500 (or $125 in premium for 12 months)

• $2000

• $200,000

• $250,000

A friend of a friend attends your Thanksgiving potluck dinner, and while going up for second helpings, they slip on some spilled water on your floor and suffer a concussion! Would this event be covered by a standard policy?

• Neither homeowners nor renters insurance will cover this, because they both only cover buildings and objects, not people

• Neither homeowners nor renters insurance will cover this, because your guest's own medical coverage should do so

• Renters insurance will not cover it, but your landlord's own homeowners insurance will because it happened on their property

• Both a standard homeowners and renters policy would cover this type of accident, typically

How much does the typical renter's insurance policy premium cost per month?

• $0

• Less than $30

• Between $31-60

• Between $61-100