We buy insurance policies to financially protect us should something go wrong. Most people would argue that insurance is a smart thing to have if for nothing else then the peace of mind it provides us. Because of this we generally do not flinch at buying adequate health, life or automobile insurance policies. However when it comes to renter’s insurance we often balk because we are unaware of the risks, and being ignorant to these risks don’t mean they are less likely to befall us.
Listed below are five of the most common myths that prevent people from seeing the need to purchase a renter’s insurance policy. Each one is followed by the facts that debunk each myth. Hopefully this list will educate you as to how important a renter’s insurance policy can be when it comes to protecting your property and finances.
My Landlord Is Insured So That Will Cover Me
Of course your landlord has an insurance policy but their policy protects their property, not yours. Generally, landlords will have their building insured and will carry a policy to protect them if they are found liable for injury or loss but that is where their policy stops. If someone is hurt on the property due to your fault, you are liable. If your stuff is stolen or damaged, your landlord’s insurance will not cover it.
My Roommate Is Insured So That Will Cover My Stuff Too
While there are policies that cover roommates, most likely the only things that are covered are the ones that are owned by the policy holder. Most renter’s insurance policies do not provide coverage for roommates or even domestic partners, only married couples.
Renter’s Insurance Is Too Expensive For Me To Buy
Insurance can be expensive. However renter’s insurance premiums don’t compare to other insurance policies when it comes to cost. Depending upon the policy you choose you can expect to spend between $150 t0 $350 per year for coverage and these premiums are paid monthly.
I Don’t Have Expensive Things So I Don’t Need Insurance
While you may not need to protect your property from loss, renter’s insurance is not only about your stuff. Sure, you may not have expensive things but if someone trips and falls over your inexpensive furniture, you are still liable. Renter’s insurance can help protect against liability claims as well as replace property.
I Live In A Safe Area
According to the US Department of Justice a person who rents is almost 80 percent more likely to be robbed than someone who owns their own home. Even gated communities suffer from criminal activity. And as far as natural disasters are concerned, no one can tell when and where one will strike.
Insurance is all about risk. Understanding the risks you face is all part of how you learn to protect yourself and your property. Should you feel that renter’s insurance is still not for you so be it, but at least you are making an educated decision, not one based on a myth.
Jeff Orloff writes on insurance topics for the Renters Insurance Blog (http://rentersinsurance.org) for the Consumer Media Network.
When examining different renter’s insurance policies, ask if the insurance covers the purchase/replacement price of your stuff or the current, depreciated value of your stuff. Big difference. Usually both are on the market, for different premiums.
Just wanted to drop a note to tell you that we mentioned your great post on our blog roundup last week, Friday Roundup: Credit Karma & Housing Market News. Thank you for the informative post and see you around the blogosphere!