When it comes to renters insurance, what is covered and what is not all depends on your specific policy. Most renters insurance policies will cover your personal property, personal liability coverage, and temporary living expenses if your home becomes uninhabitable.
The types of events that are covered will be specified in your policy, but most renters policies will include perils like fire, vandalism, theft, smoke damage, leakage, short-circuit damage, and more.
But what about big ticket items like a collection of fine art or vintage guitars? When it comes to valuable collectibles, a basic renters insurance policy probably won’t be enough to cover the amount it would cost to reimburse your collection if it’s damaged or stolen. That being said, most renters insurance companies will allow you to add additional coverage for your collectibles.
What is the difference between personal property and collectibles?
Your personal property is covered by your renters insurance up to your policy’s limit. Personal property generally means your everyday items: furniture, clothing, and sometimes computers and TVs. Your personal property is usually the items that make up your home that will be covered by your renters insurance. For example, if there is a leak in your apartment and your furniture gets ruined, your renters insurance will reimburse you for the cost of your furniture up to your policy’s limit and after you pay your deductible.
Collectibles can be a variety of things, but they generally aren’t considered everyday items that you need in your daily life. Collectibles can be things like a coin collection, a painting collection, fine art collection, or a stamp collection. Their value may exceed your renters insurance coverage limits, meaning you would need to customize your renters insurance policy to protect your collection.
When does renters insurance cover collectibles?
Generally speaking, what renters insurance does and does not cover all depends on your policy limits and the amount of coverage you purchase. Most renters insurance policies only offer coverage up to a certain limit, so if your collectibles are extremely expensive the limits may not be high enough to cover your collection.
Say, for example, that you collect rare and fine jewelry. A basic renters insurance policy may not fully not cover the cost of replacement if it gets lost, damaged, or stolen. Most renters policies will set a specific limit for jewelry coverage, sometimes as low as $1,000, so if your collection exceeds that then you should consider adding additional coverage.
You will have to take an inventory of your collection to determine how much value it has. Once you determine the value, you will know the replacement cost. This will give you an idea of how much coverage you need and if it’s doable with just a basic renters insurance policy.
How to cover your collectibles through renters insurance
If your basic renters insurance policy doesn’t cover your valuable collectibles, don’t stress out. It’s actually quite easy and relatively inexpensive to purchase more coverage or additional floaters or riders that extend your coverage. Before you purchase additional coverage, take these steps to figure out how much extra coverage you need for your collection:
Take an inventory and document your collection: In order to know how much coverage you need you will have to take an inventory of your collection to determine your total value cost. You should take pictures of all the items in your collection and keep them somewhere safe in case you ever need to file a claim. If you add more items to your collection over time, you should continue to take additional inventory as needed.
Get an appraisal: If you don’t have receipts or can’t determine on your own how expensive your collection is you should get a professional appraisal. You will most likely need to do this if your collection costs more than a few thousand dollars. You can find an appraiser online and set up an appointment with them to get your collection appraised.
Decide what you want to insure: Insuring your collection is important. Just like any other item in your home, the loss could be detrimental and costly. Once you know the value of your collection you can begin to look for renters insurance providers that will be able to fully cover your collection.
Additional riders can give you extra coverage and ensure that all of your items are protected. This can include the additional coverage you’d need for your collectibles. This can be true for other expensive items as well, like a fancy laptop or TV, which might be more valuable than the limits of your standard renters policy.
There are a few common riders that you can purchase that will cover your collectibles. That being said, adding riders or endorsements will likely raise your premiums.
Scheduled property rider: Scheduled property riders will increase the coverage for specific items. You can add a scheduled property rider for anything that isn’t covered by your policy. This includes things like your collectibles, jewelry, precious stones, or watches.
Replacement cost rider: There are two types of renters insurance policies: replacement cost policy and actual cash value policy. Replacement cost policies cost more but pay our more in the event of a claim, whereas actual cash value policies cost less, but also pay out less in the event of a claim. If you have an actual cost value property, you can purchase a replacement cost rider for your collectibles. This means you would pay a little more upfront, but you’d get enough money back to pay for some or all of your collection, depending on how much additional coverage you purchased.
Earthquake coverage rider: An earthquake coverage rider is exactly what it sounds like. It will cover your collectibles and personal property in case it gets damaged during an earthquake. If you live in an area that is earthquake-prone, it’s a good idea to purchase this rider.
An insurance broker can advise you on which types of renters insurance would be best for you. You can discuss the value of your collection to learn which riders you’d need to fully cover your collectibles and any other expensive items you might own.
What types of events are covered under renters insurance?
So, what would be considered a covered claim if your collectibles did get ruined and you had additional riders to cover them? Most of the times, your renters insurance will cover damage or loss from these perils:
Fire and lightning
Damage from steam-heating/water-heating appliances/systems
Leakage or overflow of water or steam
Windstorm and hail
What is not covered by renters insurance
Even with additional riders, there are some instances where renters insurance won’t cover or reimburse you. Below are a few examples:
Wear and tear over time: Your renters insurance won’t reimburse your collectibles from normal wear and tear that happens over time.
Damage while on loan: If you have a collection of expensive art pieces and loan them out to a museum, your renters insurance most likely won’t cover the cost of reimbursement if they get lost or damaged.
Very expensive items: Even if you purchase and add riders to your policy, if your collectibles are extremely valuable, your renters insurance might not cover them. This means you might have to take out an entirely separate, specialized policy to insure these expensive collectibles.