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Here’s Why You Need a Renters Insurance

Here’s Why You Need a Renters Insurance

Renters insurance, a sound investment

A survey of 1,400 renters by Apartments.com revealed that two-thirds of apartment dwellers don’t carry insurance. In another survey, 50 percent of these apartment dwellers are more likely to be victims of burglars according to the Bureau of Justice Statistics. Renter’s insurance may seem unimportant … until it does. Renters should be responsible for having their own insurance to cover personal belongings and liability for incidents in case of accident, burglary, fire, weather-related catastrophe. Apartments.com survey showed that the majority of renters pay an average of just $10.00 to $15.00 per month which is inexpensive and worth the money.

A renters insurance policy covers three basics: your legal lia­bility, personal possessions, and living expenses in the event your apartment becomes uninhabitable. Common renter’s policies typically cover losses from burglary, vandalism, windstorms, and certain types of water or weather-related damage. So you do the math and ask yourself…  all these protections for $10 to $15 a month worth a sound investment? 

 

Misconception about your auto insurance is that it covers your personal belongings stolen in your car

That’s not true! Your auto insurance only covers damage to your vehicle – in the case of theft, auto insurance covers the damage to your car’s glass, but not the backpack and everything inside (iPad, laptop, phones) in which those can amount to thousands of dollars. Renter insurance, to many’s surprise, covers the stolen items in your home and as well as in your car. That’s another good reason to buy renter’s insurance.

 

Story of a renter with no insurance, apartment burned down, total loss

The renter was on her way back to her apartment with a load of laundry, she was surprised to see the Fire Department ahead of her battling a blaze that threatened to consume the entire building. They were able to put the fire out and prevent it from spreading, but her building was a total loss. In the middle of the chaos, she was stunned, devastated, her mind questioning what she might be able to do without renters insurance. She had been planning to buy a Renters Insurance policy, but just hadn’t gotten around to it. The only thing she had left in her possession now were the clothes that she had just washed. Luckily, the fire department had called in a Red Cross representative, they had enough funding to offer to pay for her hotel room upfront for a 2-day stay, saving her nearly $1,000 out of nowhere. Finding a place to stay in the next few days after a fire without renters insurance can be a challenge, you’re on your own. She had to do couch surfing to survive because she had nowhere to go. If only she has renters insurance, it would have covered her personal property for a replacement cost. She’d be able to buy new properties to replace everything that was lost in the fire and would put her in a very similar condition to the one you were in before the loss.

Story of a renter’s flooded apartment with insurance

A 30-year old renter was out of town visiting her family when a pipe burst in the apartment directly above hers. If a hurricane had flooded her apartment, her renter’s policy wouldn’t cover flooding that comes from outside her building. But since it’s a burst pipe, it falls into the accident category. She filed a claim and received text message updates throughout the process from the agent handling her claim. She has accounted for all her items and has yet to decide whether to get replacement coverage or actual cash value coverage. Her policy offers to replace her items at full cost, and the latter factors in depreciation though replacement coverage costs about 5% more on her renter’s insurance. Some companies automatically offer replacement coverage as your only option. In the end, she filed her claim only to discover that the amount of losses was less than her deductible. She wasn’t surprised, but at least she’ll get something for her troubles.

Find out how much renter’s insurance would cost you with a quote from LEMONADE»

If you’re not sure whether purchasing renters insurance is worthwhile in your situation,  check out this featured property and casualty insurance company. Why Lemonade is unlike any other insurance company, it’s because they take a flat fee from your premium, use the rest to pay claims, and give back what’s left to the causes you care about. Traditional insurance companies make money by keeping the money they don’t pay out in claims. Lemonade was built differently. They take a fixed fee out of your monthly payments, pay reinsurance, and use the rest for paying out claims. They do not have any reason to delay or deny claims, so they handle them quickly and fairly.

 

Don’t learn the hard way the importance of a renters insurance

You’d be surprised how many tenants have never heard of a renter policy and they would only learn about it in the event of a fire or another disaster that could potentially damage all of their belongings by learning it the hard way. There are also tons of tenants that haven’t lost anything yet but were still unaware that renter insurance existed. Landlords should really make their tenants aware of what a renter’s policy is and why they should have one. 

Once you have it, it’s also important to do an audit of your renter’s insurance as often as necessary as you learn more about the ins and outs of your coverage. Renters insurance also changes when you move, since premiums are calculated based on the risk of each particular zip code. In the case of moving, it’s necessary to do an audit of your insurance policy to make sure you’re getting the best peace of mind there is.

At The Cal Agents,  we require every tenant we bring onboard to carry renter’s insurance, for the benefits of the tenants, landlords, and the rental industry as a whole.

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Lex Shan

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