4 Common Myths About Renters Insurance – Smarter Finance Journal

4 Common Myths About Renters Insurance

renters-insurance

The saying “Generation Rent” is starting to become a reality more and more these days. With private renting at an all-time high, it’s time to dive into something that everyone who is renting must have, or else they are naked, and risking more than they know.

I’m talking of course about renters insurance.

For approximately the cost of a few movie tickets each month, renters insurance can protect your personal belongings and save you from a legal or medical expenses associated with an accident within your home, apartment or condo. Many renters overlook this insurance policy thinking it’s too expensive or just flat-out unnecessary. Well, if you’re into driving without a seat belt more power to you, but I’m guessing we all would rather be safe than sorry.

Let’s go over four very common myths about renters insurance that should inspire you to get such coverage if you are currently without.

1. “I don’t have enough stuff to need insurance coverage”

No matter where you live, your property is susceptible to many damages. It could be fire, theft, or even a broken kitchen appliance; many experts say there isn’t a scenario in which a tenant should go without renters insurance.

You would be shocked if you actually sat down and took the time to add up all of your personal belongings. Theft is real these days, and this insurance should help you sleep at night knowing you won’t have worry to a certain degree about losing all your prized and valuable items.

2. “Since I am a renter, my landlord will cover property damages.”

Sometimes, a landlord could potentially partner with an insurance company to offer renters insurance to tenants, but more frequently, it typically only protects the building itself. “After acquiring a rental housing unit, landlords change their insurance policies from a traditional homeowners policy to a rental policy, and when they do that, it only covers just the structure, not the content or any of the tenants’ belongings,” says James Emory Tungsvik, president of the National Association of Residential Property Managers.

“Say you just bought a few hundred dollars’ worth of frozen food and you stuck it in the freezer that the landlord owns, and it breaks down, spoiling all the food,” Tungsvik says. “If you wanted coverage for that lost expense, the landlord would not responsible for it. That would be part of renters insurance.”

3. “Renters insurance only covers my personal belongings.”

The common saying “accidents happen” rings especially true with renters insurance. A flood in your apartment could even damage other tenants property, and the buildings amenities, and this a prime example of how this insurance can save thousands. Unexpected things happen and wise people try to prepare for the unknown. “For example, if your bathtub overflows and water seeps into the apartment below, damaging your neighbor’s furniture or rug, your renter’s policy will cover the damage up to your liability limits,” Lyons says.

4. “Renters insurance is too expensive.”

Wrong! It’s actually pretty affordable considering how much you benefit. Let’s break it down: in most cases, annually you are looking at about $185, monthly a tad under $20, and daily the cost of roughly 50 cents. What a steal.

Many insurance providers offer packages that include discounts when you bundle a few plans together, so realistically it could be cheaper if you are loyal to a certain provider. Everyone’s a winner.

Still, be wary and don’t jump at your first offer. Browse around and be a smart avid consumer — prices will vary just like with any other product or service.

How to choose a renters insurance policy

Renters insurance coverage needs are different for every individual, based on factors like age, location and protection needs for things like natural disasters. But in general, there are two important areas to understand when choosing a renters insurance policy: what the policy covers and whether that coverage is actual cash value or the total replace cost.

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