As a result of new Defense Department policies, some on-base property management companies are getting out of the business of providing renters insurance, allowing existing policies to expire without renewal.
In the past, service members' Basic Allowance for Housing (BAH) was made up of three components: rent, utilities and renters insurance. As of January 2015, the DoD removed renters insurance from the supplement.
"They've basically said it is now up to you to pay for renters insurance out of pocket," says Tim Kiesow, director of military life advice for USAA.
The change affects personnel receiving BAH for living in single-family homes on a military installation and those who live off the military installation.
Fort Campbell is the first installation to announce its property managers are canceling policies. As of March 1, they no longer offer renters insurance. Others are likely to follow suit.
As managers cancel policies, service members will need to find their own insurance or make sure their belongings remain covered. When considering new renters insurance coverage, service members should keep three things in mind: cost, coverage and inventory.
COST: Paying for renters insurance may be a new cost for most service members. While not substantial, it will still be an added expense for which to budget.
COVERAGE: Two types of coverage are typically available to renters:
- Actual Cash Value coverage policies offered by most property management companies should reimburse you for what they estimate your belongings are currently worth -- an amount that may not completely replace the loss. For example, that new widescreen TV you bought for $1,500 might only be worth $1,140 to the insurance company.
- Replacement Cost Coverage policies reimburse you the amount it will cost to replace your losses when you file a claim, making them more comprehensive policies. That same $1,500 TV will be worth whatever it costs the insurance company to replace it.
Look for a policy that covers your items for any possible disaster or situation and without a deductible.
INVENTORY: Once you have a renters insurance policy, create a record of your possessions, including brand and model, dates purchased, serial numbers and receipts. Supplement your inventory with photographs or video. Add up the replacement value of your belongings (including military uniforms). Speak with your chain of command to properly record your inventory of high value items. Once you're done, store your inventory and receipts in a safe place, such as a fireproof safe or bank safe-deposit box.