Tenant Insurance: The Biggest Mistake You Can Make is Not Having It

It is common for renters to skip insurance. In fact, a 2006 Insurance Research Council poll found that while 96 percent of homeowners have homeowners insurance, less than half of renters have a renter’s insurance policy.

A common perception that tenants have about insurance is that the landlord’s insurance policy will cover their belongings in the event of a fire or disaster. The reality is that the landlord/property manager insurance policy only covers the structure, not the tenant’s personal contents.

As a renter, why do you need insurance?

• It pays for any damage done by you to the property. If you cause a fire or a flood in the property, the landlord will have the insurance to cover any structural damage and you will be held financially responsible for any damage done to walls, ceilings etc. Your insurance will cover this damage; otherwise you will be out of pocket.
• It provides temporary accommodation. If you have to move out of your rental property in order for repairs to be done due to an accident you have caused, renters insurance can provide you with expenses you need to live in another place, until you can return home.
• It covers you incase there is a visitor gets hurt at your residence. If someone visiting your home gets injured, he /she can sue you for liability. Renters insurance covers you for such eventualities.
• Your personal belongings are covered. Renters insurance can protect your personal belongings against fire, theft, vandalism, lightning, and more.

One regularly hears of many stories in the news where a families are left destitute after a fire or a flood because of no insurance. The average cost of renters insurance can run from $30-$70/month depending on how much cover you need. This is not a huge commitment considering the consequences of not having the insurance. It is a wise move that will pay off for you, in the rare event you find yourself in a dire situation.