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When most people take out a renters insurance policy, they take for granted that their policy will cover high-priced items like jewelry, furniture, and electronics. Not long ago, handheld electronics like smartphones and other gadgets weren’t a concern because their low cost didn’t warrant special attention, and high deductibles meant filing a claim wasn’t worth it for most people. However, as the price of smartphones has skyrocketed well past the $1,000 mark, with some costing more than a personal computer, insuring these assets has become a priority for many.
Renters insurance is one way to do this, allowing you to protect your cell phone and other expensive gadgets against things like theft or damage. While you probably do a lot to ensure your apartment’s security, investing in renters insurance to protect your cell phone and other gadgets is a smart move. At the same time, it’s important to keep in mind coverage varies, and there may be limitations and exclusions, making it important to read the policy carefully so you understand exactly what’s covered.
Understanding your policy’s phone coverage
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Taking out an insurance policy isn’t enough to ensure your phone and other gadgets will be covered when the time comes. You need to get into the nitty gritty of your policy by reading the fine print to understand exactly what’s insured. While renters insurance typically covers handheld electronic devices, they’re only covered up to the policy’s limit.
When reviewing your policy, you’ll want to pay special attention to its electronics limit of liability, which is the maximum amount covered for the loss or damage to gadgets like smartphones, laptops, and tablets. Knowing your policy’s limit for electronic devices will let you know how much you can expect to get back in the event of theft or damage.
For example, if you take out a policy with a $15,000 cap for personal belongings that only covers up to $2,000 for electronic equipment, when you account for your deductible and how much your gadgets are worth, you may end up paying a sizeable sum out of pocket if these items are damaged or stolen.
You should also keep in mind that most insurance policies won’t cover accidental damage or loss unless you purchase additional coverage, making it important to pay special attention to exclusions before choosing a plan.
Evaluating your renters insurance policy
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Whether you have one of the best Android phones or Apple is more your speed, when deciding on a renters insurance policy, be sure to review it thoroughly to ensure your valuables are adequately protected. Your first step should be to assess the policy’s coverage limits for electronics to ensure their limits align with the total value of your handheld electronics to avoid out-of-pocket expenses in case of theft or damage.
You’ll also want to keep in mind actual cash value coverage versus replacement cost coverage when purchasing renters insurance. Actual cash value coverage calculates the claim payout based on an item’s original cost minus depreciation, meaning you’ll be compensated for what the item is worth at the time of the loss, not what it costs to buy new.
On the other hand, replacement cost coverage reimburses you based on the current market price without taking into account depreciation, providing you with a high level of protection. If you find the coverage offered in the policy you’re considering isn’t enough, consider adding extended replacement coverage to protect high-value electronics.
