There are several advantages to renting a home or apartment versus buying one; less commitment, no property taxes, and most importantly, no mowing the lawn or shoveling the driveway. It’s true that renters avoid having to purchase homeowner’s insurance, but many also believe they can get away without purchasing renter’s insurance. Some renters assume that they’re covered since their landlord already has insurance, and others simply just don’t want another monthly expense.
Unfortunately, there are many misconceptions about renter’s insurance that lead people to believe they don’t need it. While it’s not required to have renter’s insurance, it’s certainly a good idea, and the benefits far exceed the perceived drawbacks.
It covers personal property.
Think about all the items you own that are stored inside your apartment; furniture, electronics, jewelry, etc. The value of these things quickly adds up. You may think that if anything were to happen to your apartment or rental home, you’d be covered under your landlord’s insurance policy. Wrong. Your landlord’s insurance only covers the building itself; he or she isn’t liable for damage to your personal belongings unless they previously knew there were problems with the building and chose to ignore them. With a renter’s insurance policy, your personal property is covered in the event of:
Fire and lightning strikes
Wind and smoke damage
Explosions and electrical surges
Vandalism and robbery
It offers liability protection.
Most renter’s insurance policies also offer a form of liability protection. If a guest hurts themselves in your house or apartment, you could be found legally responsible. Renter’s insurance would typically cover medical expenses and any resulting lawsuits up to a certain dollar amount. Liability protection also covers damage to another person’s property from your home (if your child accidentally hits breaks a neighbor’s window while playing baseball, for example).
It covers living expenses after a disaster.
If you’re renting a house or apartment and your home becomes damaged to the point where it is unlivable (after a fire or pest infestation, for instance), renter’s insurance would help pay for a hotel and meal expenses while repairs are being made. Renter’s insurance may literally put a roof over your head during times of emergency.
The number one reason renters don’t purchase renter’s insurance is because of the cost. However, the average renter’s insurance policy costs only $15 to $30 per month, while the average person has over $20,000 worth of belongings in their home that wouldn’t be covered by a landlord’s insurance. When you think about replacing 20 grand worth of stuff, the premium is fairly inexpensive.
So do your clients really need renter’s insurance? Yes, we absolutely believe they do. Similar to other types of insurance, different policies exist for different people depending on their specific needs and budget.