Renters Insurance: A Move That Every Renter Should Consider

When buying an apartment, people usually invest lots of effort to create a comfortable and safe living space.

In such a case, insurance is implied. However, when it comes to renting, most of us think that renting an apartment is a temporary solution, and that's why most of us don't pay attention to some important aspects. Furthermore, you should consider getting some coverage if something goes wrong.

We've prepared the answers to some frequently asked questions related to renters insurance. Let's find out what kind of protection you might need in case of an emergency.

- The risks of renting an apartment

You have surely heard about that golden rule ''Treat others as one's self would wish to be treated.'' Well, the situation with personal belongings isn't any different.

It's true that you're paying rent for the apartment, but the worst possible scenario, based on Murphy's Law, may happen – you just moved into an awesome apartment with brand new furniture, but you accidentally damaged something. The price for repairing a piece of expensive furniture may exceed the costs of the monthly rent.

Moreover, the next risk relates to security. What will happen if someone breaks into the apartment and steals your, or even your apartment renter's belongings?

- Renters insurance coverage

There are numerous renters insurance providers, but the typical policy covers personal property, temporary living expenses, and personal liability and medical bills. However, before you start thinking about the coverage, you should ask yourself 'how much renters insurance do I need?'

Here are some of the most common perils, but in case you want to protect your valuable items such as jewelry, fine arts, or electronic devices from loss or theft, you should consider extra coverage.

• Fire and smoke

• Bad weather

• Plumbing issues

• Vandalism and theft

• Personal liability

- Landlord's property insurance vs. Renters insurance

Although both renters insurance and landlord insurance will include medical payments and liability coverage, there are a few important differences.

The landlord's property insurance policy is there for the building – unlike renters insurance, it covers dwelling. As we’ve mentioned, renters insurance covers the renter's personal property inside the building, and on the other hand, the landlord's property insurance covers the building itself.

However, the landlord's property insurance is way more expensive than renters insurance. The average monthly cost of landlord insurance might be as high as $1083 a year.

- What happens if I move?

Before we start discussing this, we have to mention that many things depend on the location of your new apartment.

The primary question is: are you moving to another state?

If you're staying in the same state, your policy should remain in effect. However, your insurance coverage can be affected by a couple of things, so you should check with your renters insurance provider.

When it comes to pricing, there is a significant difference in the annual cost of properties in suburbs and cities. Most importantly – your typical Renters insurance will transfer with you to your new apartment.

- Can I afford it?

Unlike the landlord's property insurance, renters insurance is affordable. The minimum monthly cost for renters insurance is $5, which is only $60 / year. However, if you want to ensure a $40,000 value of belongings, the average monthly cost will be around $15.

Such insurance is adjusted to the financial situation of students and young people who are just starting out, and that's why you, as well as everyone else, should invest a little bit and protect yourself in case of an emergency. A study, exemplified here, is showing that millennials are massively uninsured and are suffering significant financial losses due to the fact that 43% of them are renters and less than half of them have renters insurance.

The Bottom Line

Let's summarize – at the very affordable price, you'll get insurance for your personal stuff, even if we're talking about your laptop, smartphone, jewelry, or even your bike, you'll get reimbursed for the damage occurred due to plumbing problems, bad weather, fire, and smoke.

More importantly, if you damage something accidentally, your insurance kicks in! And don't forget personal liability!

If you want to feel comfortable, to protect your personal belongings, and to enjoy your vacations without fearing that someone might vandalize your rented apartment, you should get your renters insurance today.

This article does not necessarily reflect the opinions of the editors or management of EconoTimes.