If you are renting a small place and don’t have a lot of possessions, you may think there is no need for tenant insurance. Here are some common misconceptions:
- I don’t have a lot of things to protect. Even though you may not feel like you have a lot, when you start adding up what it would cost to replace your clothes, shoes, accessories, as well as the basics in your kitchen and bathroom, you’ll be surprised. Download our simple home inventory worksheet to get a rough idea of what your possessions are worth.
- I am a student, so I am covered under my parents’ insurance. Some insurance policies limit the value of the possessions covered for students living away from their parents’ home and most require that you are financially dependent on your parents and that you are only temporarily away from their home. Have you reviewed your parents’ insurance policy? What happens to any coverage if you get a summer job and don’t return to your parents’ home?
- Liability? Nothing could ever happen to me. If you decide to have a party and someone slips and falls on your throw rug, you may be held liable. Or if you’re playing a recreational sport and accidentally injure someone, you may be held liable. While we all like to think that our friends would never sue us or accidents won’t happen, are these risks you want to take?
- Insurance is too expensive. The cost of insurance depends on the value of your possessions. You can reduce your monthly premium by increasing your deductible – you take on a bit of the risk, and pay a lower premium. When you look at the cost, think about the cost of replacing your laptop and smartphone…
If you’re still contemplating if tenant insurance is right for you, here are ten good reasons why you should buy tenant insurance:
- Landlords require it. Often when you’re trying to rent a place, the landlord will insist that you have a tenant insurance policy in place.
- Replacement cost on contents. So you bought your couch at a garage sale, and your mom gave you her old dishes. Maybe you don’t think they’re worth a lot, but when you add up the cost to replace all your belongings with new ones, you may think differently. Even the cost to just replace your clothes and shoes could surprise you.
- Damage to the unit you’re renting. What if you accidentally fall asleep while you’re cooking dinner? A tenant insurance policy can cover you for smoke damage to the apartment you’re renting.
- Liability for your personal actions. If you lose control while you’re skiing, and crash into someone, you can cause serious injury, possibly resulting in a lawsuit for your negligence. Your tenant insurance can provide you with $1,000,000 coverage, or more.
- Liability for your premises. If someone comes to visit, and slips on your wet bathroom floor, again you could be sued for their injuries. Tenant insurance policies usually include $1,000,000 premises liability insurance.
- Theft from your car. Maybe your apartment is secure, but it’s always possible that something can get stolen from your car. This will not be covered under your auto insurance, but can be covered on a renter’s insurance policy.
- Property in storage. If you’ve got things in storage (maybe you’re waiting for a new home to be built, or maybe your sports equipment won’t fit in your new basement suite), you can get storage insurance on your tenant insurance policy. Some policies may include it automatically.
- Worldwide coverage. Using some of your hard-earned money to travel the world? Your tenant insurance policy will not only protect your contents at home while you’re away on vacation, but it will also cover the belongings you take with you.
- Electronics. Computers, iPods, PS3’s, Xboxes, and more. We all have them. Your tenant insurance policy can protect them.
- Pet coverage. What if your puppy nips someone’s nose? Liability claims are very common as a result of dog bites. If you own a pet, your renter’s insurance policy can cover claims of this type. You may also be able to add insurance for accidental death of your pet.
Having tenant insurance can’t prevent bad things from happening. But it’s nice to know that someone will be there to help put things right if the worst does happen. And with Square One’s home insurance starting from as little as $15 a month, why risk going without it?