About ten years ago, I was living at home when my parents got a late-night phone call.

My sister’s apartment building had burned down.

A guest visiting a resident carelessly discarded a cigarette into a trash can. It happened to be right next to the apartment building, and it caught fire in no time.

Thankfully my sister wasn’t hurt, and her cats suffered some smoke inhalation, but they were fine. Her betta fish somehow even made it out unscathed.

The rest of her possessions were shot. Except for a few objects, everything was waterlogged or sustained smoke damage. She had to trash about 95% of what she owned.

She also was the only building resident who had insurance. Her company cut her a check for her insured amount, and she was able to refurnish her apartment after it was rebuilt. The rest of the tenants were not as lucky.

Be a savvy single woman. You only have your income and yourself to rely on to get insurance. My sister’s lesson was a powerful reminder for me to always have renter’s insurance, and I have never been without. It is one of the cheapest insurances to get—most policies run $10-$25 a month, and the following tips will help you decide what renter’s insurance is best for you, and how to find it.

How much insurance do I need?

This depends on how much you own. The average renter has $20,000 – $30,000 in possessions.

  • Make an inventory of everything you own.
  • Figure out how much you paid for it, and what it is worth now.
  • If you have an emergency fund (and you should really have at least $1,000 on hand), you can have a higher deductible.

How do I shop for insurance?

  • Call around to get price quotes. I like to do this every couple years to make sure I am getting the best possible deal.
  • Get quotes online. With the exception of erenterplan.com (which is worthless because there are a lot of zip codes they don’t even offer quotes for, and I mean A LOT, you have to go from site to site for quotes. It’s a hassle, and to be perfectly honest, I got cheaper rates when I made a few calls and talked to actual human beings.
  • Bundle it any existing car/life/etc. insurance. This doesn’t work in my specific case, but it does for a lot of people.
  • Hire an insurance broker. If you don’t have the time or energy to do your own comparison-shopping, you can always have a broker do it for you. While I have never done this myself, there are definitely some benefits, the most important being you have a honest-to-God person in your corner.

Are there any things in my policy I need to be aware of?

  • Some policies don’t cover earthquakes or floods. You may need to purchase separate policies. Consult your insurance company.
  • Know the difference between Actual Cash Value and Replacement Value. Actual Cash Value takes into account wear and tear, and is the actual value of the item. This is cheaper insurance. Replacement Value would be what it actually costs to replace your item with something similar.
  • Know if you policy has a cap on certain items. If you have a $20,000 policy but only has a $2,000 cap on jewelry, you may need to get a rider or extra insurance for heirloom jewelry. 

I sincerely hope nothing ever happens that you would need to cash in your renters insurance. But having it gives you that extra peace of mind you deserve. Don’t be like the other tenants in my sister’s building. Be savvy and protect your possessions!

When was the last time you compared renters or homeowners insurance policies? Comment below and tell us your story!