Do you remember when laptop computers used to be superfluous luxuries only carried around by those lucky enough to be able to afford them, or those so cool they couldn't afford not to own them? Times sure have changed. Nowadays, you're a lot more likely to find a laptop sitting on someone's kitchen table, while that enormous dinosaur of a desktop computer has long been relegated to the spare bedroom—or better yet, donated to charity. A big part of this trend is the rapidly falling cost of technology. But, just because they're a lot more affordable now than they were five years ago, is this any reason to forego buying a policy that includes laptop insurance?
The answer is probably "no." You can do so economically by purchasing a renters insurance policy.
Did you know that your laptop is covered under your renters insurance policy? Renters insurance offers several different coverages: liability coverage, additional living expenses coverage, and personal property coverage. Coverage for your laptop falls into that last category, which provides coverage for your personal property if it is damaged or destroyed by a covered peril. Perils that are normally covered in a renters insurance policy can vary, but usually include fire, windstorms, lightning and certain types of water damage. Renters insurance also covers theft of your personal possessions.
Before you buy renters insurance, consider your options. You may have to choose between Actual Cash Value and Replacement Cost coverage. The difference between these two is pretty straightforward and easy to understand.
- Actual Cash Value coverage reimburses you the dollar amount you might reasonably expect to get if you sold the item today. In other words, that's replacement cost minus depreciation. You might have spent $800 to buy your laptop computer a couple of years ago, but that's not necessarily what you'll get for it today from your insurance company.
- Reimbursement Cost coverage pays you enough money to be able to replace the laptop with one of the same kind. Needless to say, premium costs for Reimbursement Cost coverage may be a bit more expensive than the cost of Actual Cash Value coverage, but it will give you the opportunity to buy a new laptop.
If your laptop is extremely valuable, you may also want to consider paying extra for a "floater." Another name for this is Scheduled Personal Property coverage. Basically, you can assign a higher level of coverage for specific items that you know are worth a lot more. Most insurance companies have a specific coverage limit for personal possessions, which means that the payout amount for a stolen or destroyed item may top out at $1,000. This amount may or may not be acceptable. Be sure you know the value of your computer before you buy renters insurance so you don't inadvertently underinsure it.
Renters insurance doesn't come free, but the potential payoff you can get in the event of a disaster can far outweigh the cost of premiums. According to the Insurance Information Institute, the average cost for a renters policy in 2009 was under $16 per month —$15.33, to be exact. When you do the math, the total comes out to only $184 per year. When compared with the financial burden you'd have to shoulder to recover from a catastrophic loss, this coverage could turn out to be quite a deal.
Visit Allstate.com's Renters Insurance Coverage page for more information and to get a quote.