What tenants should know about protecting their possessions.
Renters insurance is one of the only ways that tenants can protect themselves against the destruction or loss of their possessions while renting an apartment or house.
The NAIC says that a tenant’s contents aren’t protected by a landlord’s coverage.
One of the most common misconceptions about coverage, says the National Association of Insurance Commissioners (NAIC), is that the belongings of tenants, contained in the rental property, are covered by the policy of the landlord. Many people think that renters insurance is meant only for people who have valuable high end possessions, or are under the impression that it is not an affordable form of coverage.
The truth is that renters insurance is very affordable – often less than $20 per month.
The landlord’s policy is meant only to cover the building itself, but not the possessions that it contains. Therefore, if there were ever a fire, for example, then the landlord’s coverage would pay for the damage to the structure, but not the clothing, television, laptop, and other possessions inside.
The NAIC says that renters insurance is extremely affordable. The average policy costs around $184 per year. This means that the monthly payments are an average of $16. For most tenants, this tiny monthly expense is certainly worth it, if only for the peace of mind of knowing that their belongings are covered in the event of lightning, fire, smoke, theft, vandalism, windstorms, explosions, and several other types of loss.
Moreover, if the building is ever damaged, to the point where it is not considered to be livable, then renters insurance policies will also often provide payments for the additional living expenses that can occur during that time – such as living at a motel until the home is adequately repaired.
Coverage from these policies can also include liability protection, so that the tenant is protected in case another person is ever injured while inside the apartment.
Though the cost of renters insurance is affected by many factors, such as where the residence is located, how much coverage is wanted, and the size of the deductible, many people are surprised at how affordable a policy is.