The Importance Of Renters Insurance For America’s Rental Boom

rentersinsurance

Over the past decade, the percentage of Americans who have chosen to rent their homes has grown. This trend is expected to continue over the next ten years. Even more surprising, this trend is true for people in all economic classes and family types. Even though most renters decide to live in an apartment, a great number of neighborhood homes are being converted into rental units as well. With a growing percentage of American renters, renters insurance has been getting more attention.

Why is Renters Insurance Important?

Some renters don’t believe that they they need to purchase coverage because they don’t actually own the dwelling that they live in. Naturally, renters insurance doesn’t cover the building, but it’s still important to consider.

Renters insurance usually does cover:

  • Home contents: State Farm, a national homeowners insurance company, says that average people own about $20,000 worth of property that they keep in their homes. This includes home appliances, electronics, jewelry, apparel, and furniture.
  • Liability: In today’s society, there’s always the threat of having a visitor claim they suffered damage because of a renter’s negligence. This coverage can help defend the policy holder and pay damage or injury claims.
  • Loss of use: If the home is damaged and must be evacuated because of a covered hazard, this part of the policy will provide money to help the renter find temporary housing.

It’s important to understand how different policies cover home contents. For example, some policies may only offer to cover possessions at their current value. Most renters are not going to be happy to have to replace their TV sets and computers at thrift store prices. It’s probably a good idea to find coverage that covers home contents at their replacement value. That way, the policy owner will be able to purchase new items to replace the lost or damaged ones.

What Does Renters Insurance Protect Against?

These kinds of policies usually cover threats like thefts, accidents, and fires. It’s important to note that they probably won’t cover a policy owner against floods. For flood insurance, American renters need to take out coverage from the National Flood Insurance Program. In some areas, the policies also might not cover renters against earthquakes, sinkholes, and windstorms. It this is a concern, it’s a good idea to speak with an agent about adding those kinds of coverage.

Besides that, both plans and premiums may vary, so it’s important to shop around to find a good value from a quality company. Renters insurance is usually much cheaper than homeowners insurance because it doesn’t cover the building.