Protect You And Your Finances With Renters Insurance
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Millions of Americans rent their homes, apartment complexes, or condos. Renting is an effective way to have a long-term residence without committing to homeownership and enables potential home buyers to wait for the ideal opportunity to purchase a home they want.
Everybody from college students to families can live in a rented house, and they can work with their landlord to draw up a lease that works for them.
However, while rinsing has many benefits for both the renter and the landlord, there are some potentially immense financial repercussions living in a rented property. For example, your property may be stolen or destroyed, a dog might bite a guest or injure somebody on the rental property, or a natural disaster may temporarily destroy the property, requiring you to move somewhere else.
Fortunately, renter’s insurance exists to help reimburse and recover Financial losses that may be impaired by somebody renting their home.
Renters insurance is relatively affordable; many policies can be as low as $200 per year or less, depending on your insurance provider.
Today, we will discuss some of the biggest reasons to purchase renter’s insurance and how it can help you avoid putting yourself in a financially precarious situation.
Liability Is Expensive
Liability for legal fees and damages can be costly if somebody incurs an injury on your rental property. You may think that the landlord’s homeowners policy would cover any issues that may happen at your rental, but the truth is that it only covers damages to the property caused by external events.
Renters who understand this generally have a renters insurance policy that can help protect them in the event somebody gets hurt or files a lawsuit while they are on the premises. Below are a few examples of some of the most common and expensive damages that can occur on rental properties.
- Dog Bites
Most Americans have a dog, a cat, or both. Unfortunately, sometimes dogs can be unpredictable, and they will bite somebody out of confusion or defend their owners from a perceived threat. Average estimates for medical and legal bills caused by a dog bite can be upwards of $35,000. Instead of being on the hook for the entire amount, rental insurance policies can pay out and cover medical and legal fees up to the policy maximum.
- Fire Damages
Fires are generally catastrophic, and they can wreak havoc on a home and personal property. It’s a fire burns down or at least significantly damages your rental residence, you may not have somewhere to live or a way to get your property restored. Rental insurance policies step in to pay for temporary housing and reimburse you for all of the property destroyed in the fire.
- Valuable Possessions Stolen
Thieves can quickly steal your most valuable possessions without a trace, and even if you file a police report, there is no guarantee that they will catch the thief or be able to return your possessions. Thankfully, rental insurance usually covers theft of personal property and will reimburse for the value of the items stolen, Which will make you whole and save you the money from purchasing everything over again.
Renter’s Insurance Helps Pay For Expenses You May Not Be Able To Afford
As you can see, renters have potential exposure to some extremely expensive liabilities and Financial risks.
Thankfully, renter’s insurance is available and designed to help mitigate any financial losses and reimburse for damages and expenses covered by the policy.
For example, medical and legal expenses for an injury caused by a dog bite could cost over $30,000. If you did not have a renter’s insurance policy, you may be on the hook for the entire amount, which could be financially catastrophic.
However, if you have renter’s insurance, you may only need to pay a small deductible, if anything at all, if the event is a covered loss. If your annual renter’s insurance premium costs $200, then paying out $30,000 for a dog bite injury would pay for the premium for 150 years worth of being insured.
Another example where having renters insurance can help prevent a financial catastrophe is if somebody steals expensive personal property from you, such as entertainment systems or computers.
If you have $4,000 worth of technological equipment and personal property is stolen, you would be responsible for replacing it if you could afford to Fork over the cash for new equipment. Or, if you have renter’s insurance with the premium of $150 per year, filing a claim and being reimbursed by the insurance company would pay for the premium for more than 26 years.
Unfortunately, both of these examples can happen to a majority of renters, but since renters insurance is relatively affordable and accessible, you can effectively mitigate the potential damages of a covered loss by purchasing a renter’s insurance policy.
Make Sure To Shop Around For The Best Policy
Hopefully, you understand how powerful a robust renter’s insurance policy can be, and if you are interested in purchasing one, many insurance providers offer renter’s insurance on top of their auto insurance or home insurance coverages.
While renter’s insurance policies are widely available from most large and medium-sized insurance carriers, it’s important to shop around to make sure that you are getting sufficient coverage and a reasonably priced premium.
It’s easy to over-insure yourself and pay an excess premium for too much coverage, so take some time and calculate the value of your household possessions and what it would cost to replace them in a total loss.
Once you have an idea of how much coverage you need, submit quotes with multiple insurance providers to see how much your premium would be if you purchase a policy today. You will most likely receive a range of quotes, and you can choose the option that fits your needs and budget the best.
Optimize Your Premium With Discounts
After you choose an insurance provider, do some research and see what types of discounts you may qualify for. The insurance provider may not automatically enroll you in discounts you are eligible for, so do some digging and provide them with as much detail about your lifestyle as possible.
Some insurance carriers will offer a bundle discount for purchasing auto insurance and rental insurance through their platform, which can save you money on both your auto and renters insurance.
Likewise, you may qualify for a discount depending on your college GPA, history of insurance claims, and a variety of other circumstances.
Renters insurance is one of the most potent insurance lines available because of the relationship between the premium cost and how much the policy is able to payout.
Most insurance policies do not payout at the multiple renter’s insurances, and rental insurance policyholders have access to a suite of other benefits, including travel insurance that extends to their property even if they are not at their rental home.
If you are interested in learning more about renter’s insurance, check out our reviews of the top insurance providers as well as our other guides to learn more about how a renter’s insurance policy may fit into your budget and improve your personal finances.
* This content is not provided by the financial institution or the offer’s provider. Any opinions, analyses, reviews or recommendations expressed here are those of the author’s alone, and does not constitute a financial or expert advice.