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Could you afford to replace your entire wardrobe if your apartment caught fire? How about your mobile phone, your laptop and all your furniture? If the answer is no, you definitely need renters insurance. Renters insurance won’t stop awful things from occurring, but it can make life a little easier if and when they do occur.
In a recent poll, 56% of renters don’t currently have renters insurance. Although, there may be a dozen excuses, more landlords are now requiring renters insurance as a requirement under the lease agreement. There are also a handful of states who require tenants to carry renters insurance as a result of being inundated with too many small claims cases in the court system.
Renters insurance is very affordable, in most areas, a policy may be available for less than $10/month. The premium will vary based on selected limits of coverage and deductible. For those worried about the expense, renters insurance coverage may cost less than you expect.
Here’s why you may want renters insurance and how affordable it can be.
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You are not covered by your landlord’s insurance
Landlords are beginning to require tenants to purchase renters insurance, but if yours doesn’t, it’s not because they’ve got you covered.
Landlord insurance covers the structure of the building but not tenants’ personal belongings. If someone steals your TV or a fire destroys your bedroom furniture, your landlord’s insurance won’t pay to replace them — but a renters policy typically will.
A landlord’s policy is also unlikely to help if you accidentally damage a neighboring apartment.
A standard renters insurance policy includes liability coverage starting at $100,000, which can pay damages and legal expenses if you’re responsible for accidentally injuring someone else or damaging their property.
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Your belongings are probably worth more than you think
Some renters state that they don’t have anything worth insuring; but in fact, they may not have the money to replace their belongings. Then just imagine getting sued for a negligence case whether in you rental unit or elsewhere and having your wages attached for future earnings due to a lawsuit; the reality is that your annual premium will most probably be less than 10% of one month’s rent.
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Loss of Use – What if your rental unit is not livable due to a covered claim?
Most policies will offer a Loss of Use or Additional Living Expense coverage reimbursing you for hotel charges or additional incurred expenses such as restaurant meals, laundry expense or other miscellaneous expenses incurred as a result of being displaced due to a covered claim.
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Renters Insurance can protect your assets
Perhaps you are temporarily renting a unit while saving to purchase your own home, and are building a savings fund to use for your down payment. The worst thing would be a lawsuit wiping out all that you have saved. Personal liability insurance is automatically available with your Renters Insurance Policy; this could be as a result of a dog bite, the actions of a child or someone slips and falls as a result of your negligence.
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Coverage for personal belongings away from home
Many renters policies provide some coverage for your stuff even when it’s not at home. Perhaps you mistakenly left your laptop or briefcase in your vehicle during a quick stop on the way home and somebody broke into your car and stole your personal property, you policy may cover you. Your deductible would definitely apply, so it would only be worth filing a claim if the cost of replacement was greater than your deductible. On this same topic, you would most likely have coverage for items in a storage unit; most policies will provide 10% of your personal property coverage limit while away from home.
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The premium is most likely less than you expect
The most common reasons for the avoidance of purchasing Renters Insurance are: expectation that it is too expensive, couldn’t be bothered because the landlord doesn’t require it, incorrect assumption that the Landlord’s Insurance will cover the tenant, and some people will come out and say ‘I couldn’t care less about insurance!’ (of course, until they are faced with a personal loss).
If the worst happens, you’ll likely be glad you paid for the coverage.
Whether you’re looking to buy, sell or refinance your home, HDA Insurance Brokerage is available to insure your new property; whether an owner-occupied home or a tenant-occupied rental unit. You may obtain a FREE Home Insurance Quote Online when you’re ready.
