Renters insurance is an often overlooked option for tenants, but it’s a valuable resource for both renters and their landlords. According to the National Multifamily Housing Council, 37% of U.S. households are renter-occupied, yet the most recent Insurance Information Institute poll found that only 41% of tenants said they had renters insurance. When these numbers are compared to the 95% percent of homeowners who carry homeowners insurance, it shows that a large majority of renters are either knowingly or unknowingly leaving themselves open to the risk of financial loss.
Some landlords or apartment managers are aware of the benefits that renters insurance provides for both themselves and their tenants and will emphasize the importance of renters insurance to their tenants or even include it in the lease as a requirement. However, many renters hold on to some beliefs about renters important that may not be true. Common myths about renters insurance can perpetuate the trend of opting out of this essential coverage. Here are some of those myths, as well as the facts that can help renters avoid making a costly mistake.
Myth #1: “The landlord’s insurance will cover everything.”
A common assumption that renters often make is that their landlord’s insurance is all the coverage they need. Unfortunately, that’s not the case at all. The property insurance a landlord carries will cover damages to the building itself and bodily injuries due to the owner’s negligence, but it does not cover the replacement of any of the renter’s belongings such as furniture, clothing, electronics or other valuables; while renters insurance does. A renter does not have control over what other tenants do, meaning an irresponsible tenant in one unit can cause major damage to an adjacent tenant’s unit as well as their personal property.
Myth #2: “I don’t own anything worth insuring.”
Even though a renter may not live a luxury lifestyle, the amount of personal property they own can easily add up to tens of thousands of dollars. The average renter would not be able to cover that cost on their own. What many tenants don’t realize is that renters insurance can cover more than just their personal property. Renters insurance can also cover borrowed property that was damaged or destroyed in the renter’s home. Renters insurance also includes liability and medical coverage, meaning if a guest was injured inside of the renter’s home, or the policy holder accidentally caused damage to an adjacent unit, it can help pay a portion of the medical or repair expenses up to the policy limits. It may also include reimbursement for temporary living expenses if a renter needs to stay in a hotel while repairs are being made to their unit. There are some exclusions, as most renters insurance policies do not cover damage done by pets, or events such as floods and earthquakes.
Myth #3: “Renters insurance is too expensive.”
Renters insurance is actually significantly cheaper than most any other insurance policy. According to the National Association of Insurance Commissioners, the premiums for renters insurance average between $15 and $30 per month depending on the location and size of the rental unit and the policyholder’s possessions. Renters insurance may also be bundled with other types of insurance policies in order to reduce costs even further.
About The Insurance Store
The Insurance Store was created to bring ease and agility to Surplus Lines coverage placement for agents serving commercial and personal lines clients in specific regions throughout the country. We provide a wide variety of packages for hard-to-place products and risks that include earthquakes, floods, hail, and more. To learn more about how we can protect you in the event of an unforeseen event, contact us today at (425) 313-9605.