When anyone moves into their new apartment the first time, they’re often more concerned with unpacking boxes, hooking up utilities, and getting the cable guy to confirm a time for installation. The last thing on their mind is renters insurance.

Like most people, you probably figured the landlord’s insurance was enough. Unfortunately, that just isn’t true. The landlord’s insurance only covers structural damages; it does not protect your personal effects what-so-ever.

This is why investing in a renters insurance policy is a smart move. Let’s take a look at some of the most commonly asked questions about renters insurance and their answers.

Renters Insurance FAQs

Q: What does the landlord’s insurance cover?

A: The specific property and premises that a landlord will pay to have covered is going to be insured for (most times) full replacement cost. In other words, if the landlord’s entire apartment complex burns to the ground and is a total loss, then the insurance company will pay to have it rebuilt to the exact replacement value that it estimated at before the fire. But even though they will have everything that was insured replaced, you need to remember that your landlord isn’t paying to insure your stuff.

Q: What is renters insurance?

A: Renters insurance covers the monetary value of your personal belongings if they are damaged, stolen or lost. There are two types of renters insurance: Replacement Cost and Actual Cash Value.

Q: What is the difference between the Replacement Cost and Actual Cash Value policies?

A: Replacement Cost covers the actual cost of replacing your damaged or stolen property. Actual Cash Value covers the costs to replace your property minus a monetary deduction for depreciation. This means insurance companies consider the age and condition of the lost item and then reimburse you for the item’s current used value. It’s probably clear that best renters insurance policies of the two is the Replacement Cost plan.

Q: Is my roommate covered by my renters insurance policy?

A: Yes. Three people living in the rental unit can be covered under one policy.

Q: How expensive is a renters insurance policy?

A: As of 2013, renters insurance cost Americans on average $188 a year. Divide that number over 12 months, and it costs just a little over $15 a month. Split between you and a roommate, renters insurance is less than $10 a month.

Q: My apartment complex has bed bugs. Does renters insurance cover me for that?

A: Renters insurance does not protect against bed bug infestations. If the bed bug infestation was a prior condition, your landlord is responsible for extermination costs.

Q: Is renters insurance tax deductible?

A: Renters insurance is not typically tax deductible. It is only tax deductible if you operate a business from your residence.

Q: If renters insurance covers fire and smoke damage, does it also cover flood damage?

A: Renters insurance does not cover flood damage. The only instance in which it would would be if a pipe burst in your wall, causing a leak and damaging your things.

Q: If I move out of my apartment and into another rental, can I still use my same renters insurance policy?

A: Yes. Your renters insurance policy moves with you. Though do contact your insurance agent if and when you are moving; you might get a discount!

There are a lot of good reasons to get renters insurance; just look at all the stuff in your living room alone. In general, any good landlord is going to have coverage in place to protect themselves. But you need to take the due diligence to look out for yourself, otherwise you could get in a dicey situation. Take the time to look into things now and make sure you’re covered before an incident actually occurs.

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[This guest post has been brought to you by BitGold, and discusses an innovative way to receive/send payments]

Good morning folks, my name is Victor and I am a freelance writer. I have a specialty in business and finance writing – I write business plans, proposals, feasibility studies, and I write general and specific articles on business and finance topics. Enough about me, let’s get down to what interests you. Today, I want to share my first-hand experience with different payment systems and I hope you’ll be able to learn a lesson or two.

Interestingly, you’ll find the lessons that I have learnt about the easiest ways to get paid valuable. Everybody needs to know how to be paid without stress and it doesn’t matter if you are being paid for services that you have rendered or whether you are collecting money from family and friends.

One of the most important things that must be worked out as a freelancer is finding an efficient system through which you will be paid by your services. In the more than 6 years of working fulltime as a freelancer,  I have learnt that cash must flow and the easiest way to ensure cash flow is to make sure that you are being paid (in full) for your services when due. I have tried collecting cash, I have asked clients to send me checks, and I have tried PayPal – it has almost always ended in frustration.

Being paid by cash

When I first started out, I was doing freelance business writing for small businesses in my immediate environment. I usually prefer getting paid in cash – because cash is king. One of the lessons that I learnt is that it is not always easy for a new business to empty its cash register at the end of the day to pay for a service. Many of them ended up owning me for a couple of months and even when they eventually paid up, they didn’t pay up in full.

The worst part was that inflation tends to erode the value of my money and $100 owed for more than six months buys a lesser amount of goods. Another lesson that I learned the hard way is that the IRS is paying attention even when it seems that cash doesn’t leave a paper trail. The businesses that paid me deducted the payments as business expenses and the IRS was quick to figure out the rest.

PayPal is nice but 4.5% transaction cost is a drag

After my freelancing business had extended beyond my immediate environment, I started collecting payments through PayPal. PayPal sounded like an easier and faster means to get paid. For one, all it required was an email and neither my clients nor I needed to disclose our financial information to send and receive payments.

PayPal sounded cool until I got hit with a 4.5% transaction charge every time a client paid me; of course, the transaction cost for U.S is about 2.9% plus $0.30 of the received amount. 4.5% transaction charge sounds small but it translates to $4.50 on $100 and $45 on $1000 – I knew I could find better use for that $45. The worst part was that PayPal was always asking to come and explain why I was sending money to some other freelancers that were working with me.

I also have issues with the fact that PayPal tends to support the clients without any protection for freelancers. I once had a client who sent me payment via PayPal – I sent him the completed project as soon as I got the payment notification but he went back to seek a refund from PayPal and PayPal didn’t think twice about taking money out of my account to refund him.

My Experience with BitGold

I recently tried getting paid with gold and I have been pleasantly surprised at how much easier and cheaper it is to send and receive payments through gold. I observed that being paid with BitGold is the smartest solution for online money transfers right now.

A client introduced me to the idea of receiving payments in gold and I went ahead to open a BitGold account. She told me that people interested in sending gold as payments will need to open an account with BitGold and deposit funds by buying gold at just 1% over the spot price of gold.

After I opened the BitGold account, she sent me my payment as gold and the funds were deposited in my account with remarkable speed. The best part was that I could redeem the gold into a local bank account, load it into a GoldMoney MasterCard Prepaid Card, or redeem my money as physical gold.

The greatest benefit that I enjoyed from being paid with gold is the price increments in the value of gold in my account. You’ll agree with me that the value of gold tends to rise during periods of market uncertainties – we live in uncertain economic times and the yellow metal has been soaring. This year gold has rewarded investors with more than 16% YTD gains and some of those gains accrued to the gold in my account.

Conclusion

Gold is currently the best performing commodity in the market and it doesn’t appear that the yellow metal will lose its shine anytime soon. I have observed that getting paid with gold provides me with an opportunity to benefit in two ways. Firstly, I benefit from the speed at which funds are transferred to my account with practically negligible transaction costs. Secondly, I benefit from the price gains that I see in my account balance as the value of gold increases in the general market.

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