A 2014 poll from the insurance information institute found that 37% of renters don't get a renter insurance policy. It was astonishing to find out the reasons tenants gave for not purchasing it; they were mostly all myths and misconceptions.
You've got belongings, and most of them are likely worth a decent amount of money. Don't you want to protect those belongings from events that are outside of your control?
This article will help tenants clear the fog of misunderstanding so that they can re-evaluate whether it is time to purchase renter insurance. Here are the top five reasons tenants gave for not buying it.
- I am already covered by my landlord's insurance
- Renters insurance is too expensive
- My stuff is not worth insuring
- It takes too long.
I am covered by My Landlord's Insurance
That is not quite true. Most policies for landlords cover just two things: the physical structure of the building, and liability should someone be injured on the property (not inside your rental unit). There is not much in their policy to cover your personal belongings or liability within your space; except for damage done to your personal property as a result of the landlord's negligence. In that case, you could seek reimbursement through the landlord's policy. However, you would be left uncovered should the property floods due to a sudden pipe bursting, or should there be a fire, vandalism or theft.
There is also the fact that a landlord does not own any of your belongings; so even if they wanted to help you out and filed a claim for your stuff, the insurance company would most likely determine that the landlord does not have an “insurable interest” in the lost/damaged/stolen property. Their claim would be denied, and so would yours.
It's also important to note that landlords are not required by law to have a landlord insurance policy. Many tenants do not know that; so they may take for granted that there is one.
Renter Insurance Is Too Expensive
Is it? Did you know that you can get renters insurance for as little as 50 cents per day? The national average for renter insurance premiums is $12 per month. That's only $144 per year. The average policy provides for $30,000 of property coverage as well as $100,000 of liability coverage.
There are also levers you can pull that adjust the total expense. You can adjust the deductible; the higher your deductible, the lower your annual or monthly premium payments. You can also increase or decrease the total coverage you want or need. A lower property and liability coverage also means a lower annual or monthly premium.
Rather than thinking that the cost of insurance is too expensive, you ought to consider that the cost of replacing your belongings will be even higher.
My Stuff is not Worth Insuring
That could not be further from the truth. You have got a couch you are sitting on, a TV, and probably a laptop or tablet. There is a good chance you have also got some nice clothing hanging in your closet, some shoes, and nice jewelry or a watch. You may be thinking that those were all “hand-me-downs” and are not worth anything; it is tempting to think in terms of what you paid, but in reality, you should be thinking in terms of what it would cost you to replace those things.
So even if your TV was a hand-me-down, when your parents upgraded their TV; if they stole it, you would still want to replace it, and that replacement cost is what you should consider.
It Takes Too Long
This is certainly true. We have to give credit where credit is due. In today's world, something that takes a full 5-10 minutes may be too long; but, knowing what you know now,