If you rent your home, chances are you are one of the over 60% of renters in America who don’t carry renter's insurance. This type of insurance is not required by law, although some landlords will require their tenants to purchase it.
Even if you are not required to carry renter’s insurance, you may want to consider purchasing it.
I know, the last thing you want to hear is that you need another insurance policy, especially one that you aren’t required to have. If nothing else, making your way through this article may leave you more informed as a renter, and put you in a better position to make decisions regarding your insurance options.
The national average cost of renter’s insurance is only about $15 per month, and yet it provides thousands of dollars' worth of coverage for Personal Property (your stuff), Personal Liability (coverage in case someone else is hurt in your place, and Loss of use (expenses if you have to go live somewhere else due to a covered loss).
This is important because landlords are required to carry insurance that covers their property, but landlords have no reason to cover you or your property, leaving you (the tenant) unprotected in the event of a loss.
Personal Property under a renter’s insurance policy typically covers your belongings if they are damaged as a result of a covered peril.
For example: You rent a home and a fire damages your laptop, television, and furniture, resulting in $5,000 dollars’ worth of damage. If you do not carry renter’s insurance, you will have to replace those belongings out of pocket, assuming you can afford an unexpected $5,000 expense.
On the other hand, if you do carry renter's insurance, you will be able to file a claim and have your insurance company pay for the covered loss you up to your policy limit (minus your deductible).
This coverage will protect you financially if you are held responsible for losses suffered by another person while in your rented home. Like if a guest becomes injured while attending your next holiday party after one too many eggnogs*.
Although it seems rare, there is a chance that you could become legally obligated to pay for their medical bills, as well as any additional damages that may be awarded to them by a judge if you are found to be at fault. These types of expenses can quickly reach heights far beyond the average person’s ability to pay.
Finally, renter’s insurance will cover additional living expenses for you and your family if a covered cause of loss renders your home unsuitable to live in. This specific coverage is often referred to as “Loss of Use,” this coverage can be invaluable considering the costs associated with staying in a hotel for any extended period of time (or having to go stay with your family).
Renter’s insurance policies are relatively inexpensive and provide decent coverage for most of the risks you face as a renter. If you are part of the majority of renters that do not carry renter’s insurance, consider your options and think about protecting you and your family.
*It is the author’s personal opinion that any number of eggnog’s is one too many. Seriously, heavy cream, raw eggs, and alcohol is gross.