Why Tenants Need Renter's Insurance
April 1, 2011
By: Kristine A. Phillips
Many Tenants falsely assume that when they are renting a property from a Landlord, that the Landlord’s insurance will protect them if something happens that destroys their personal belongings in the rental property. This is not necessarily true. While Landlords should carry hazard insurance policies, these policies are usually designed to protect the Landlord and the property itself, and not the Tenant or the Tenant’s contents within the property. Renter’s insurance is available to Tenants to help protect them in the event of such a loss.
For example, if there is a fire in the property that results in the destruction of the Tenant’s personal belongings, most people do not have the money to replace all of these items. Renter’s insurance provides protection in such instances. For what is usually a minimal insurance premium, you can contact your insurance carrier when your personal property is damaged, and have them pay you to replace these items. Depending on the amount of coverage you purchase, you may be able to recoup all of your losses. Also, some renter’s insurance policies may cover temporary lodging while you try to relocate if the damage prevents you from returning to the property. Additionally, renter’s insurance may also provide coverage in the event of theft from your rental property. Further, such insurance may also offer liability coverage, in the event that someone is injured while at your rental property.
Renter’s insurance is generally less expensive than most people think. A basic renter’s insurance policy may cost as little as $200.00 per year. This dollar amount may fluctuate based on the dollar value of the personal items you wish to insure, any additional coverage you may be requesting, the insurance carrier and your previous insurance payment history. Renter’s insurance may also be available at a discounted rate, if you also have other insurance policies with the same insurance carrier. For example, if you have car insurance, you may want to ask your car insurance carrier if they also provide renter’s insurance. Sometimes these costs can be bundled together, at a discount to you. To get the best deal, it is always best to shop around and check with different insurance companies to see what they are able to offer you.
Try to get as much information about the renter’s insurance policy you are purchasing as you can, so you know what to expect in the event of a loss. When purchasing renter’s insurance, be sure to ask about your deductible. This is an amount that you would have to pay out of pocket before the renter’s insurance would start to cover you. You may also want to know what is excluded from the renter’s insurance policy. Staying informed from the outset will make the process of recouping losses with renter’s insurance less stressful.
Many leases require that Tenants have this insurance, but, even if it is not required, Tenants should obtain Renter’s insurance. Maintaining renter’s insurance is a minimal cost for the peace of mind and protection it can offer in the event of a tragedy.