Many renters are taking a big risk by going without renters insurance. According to a poll conducted by ORC International, only 37 percent of U.S. renters maintain renters insurance, while 95 percent of homeowners maintain homeowners insurance. Many renters may go without coverage because they don’t realize how important it is. Here’s why renters need insurance.
Reason #1: Your landlord’s insurance doesn’t cover your personal belongings.
Some renters may think they don’t need coverage because their landlord has insurance. This is not exactly true. Although your landlord should definitely have insurance, this policy will generally cover the building but not the tenants’ personal items inside.
In other words, if a fire destroys your home, the landlord’s insurance will cover the damage to the building, but you need renters insurance to cover your clothes, electronics, furniture and other belongings. And if your home is burglarized, you need renters insurance to cover the cost of replacing your stolen items.
Think about all the items you have in your home. If they were suddenly gone, would you have the money needed to replace everything out of pocket? For most people, the answer is no. But that’s just one reason why renters need insurance.
Reason #2: Renters insurance covers more than your property.
Renters insurance can cover the cost of replacing your belongings if they’re damaged, destroyed or stolen, but it can also do a lot more than that.
Let’s say your home is temporarily unlivable. Your landlord’s insurance may cover the repairs to the building, but where will you live while the repairs are being done? If you have to stay in a hotel, that’s going to cost you money.
Renters insurance can help with that.Renters insurance can also provide liability coverage. If your dog bites someone, for example, or if a guest is injured in your home, you could be sued for medical expenses. When that happens, renters insurance can pay for the costs up to the coverage limit.
Reason #3: Renters insurance provides a lot of protection for a small price.
According to Value Penguin, the average monthly premium for renters insurance ranges between $9.58 and $20.33, depending on whether you live. In Hawaii, the average monthly premium is $18.42.
That small premium buys you a lot of protection. According to the Independent Insurance Agents & Brokers of America, the typical renters insurance policy provides $30,000 in property/contents coverage and $100,000 in liability coverage.
Reason #4: Your landlord may require it.
For many renters, insurance is not optional.
Many landlords require tenants to carry renters insurance. If your lease says you need to maintain renters insurance, then it’s not even up for debate. You need to have it.