Why Renters Insurance Is Worth It – Forbes Advisor

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Are you paying more rent than you would like? If so, the idea of ​​adding another monthly bill isn’t a very appealing option. So it’s easy to dismiss renters insurance, thinking you don’t have anything worth insuring in the first place.

But renters insurance covers much more than your personal belongings. It also provides liability insurance, temporary living expenses and more. All for around $10 a month. If you’re unsure about renters insurance, it’s time to give up. Here’s why renters insurance is worth it.

Renters insurance is cheaper than buying new things

So, let’s address a renters insurance myth for the naysayers: you don’t own enough stuff to buy insurance.

You do. Think about your closet, your furniture, your pots and pans, your bike, your laptop, and all the things you rely on every day. What would you do if a fire destroyed them? Could you afford to buy all the new stuff? Even if you could afford it, would you really want to pay out of pocket?

If you are not convinced, take an inventory of the house. It can be as simple as a written list or you can even take photos or videos with your smartphone. A home inventory will give you a good idea of ​​how much stuff you actually own and how much it is worth.

Related: What does tenant insurance cover?

Renters insurance can help pay for your legal costs after an accident

Accidents happen. Like a guest tripping on your rug and getting hurt. Or maybe you relive your glory years and accidentally kick a soccer ball through a neighbor’s bay window.

This is where the liability portion of your tenant insurance comes in. It covers accidental property damage and injury to others. For example, if your dog bites someone, liability insurance can cover their medical expenses. It also covers your legal costs, settlements and judgments if you are sued due to an accident.

If an accident occurs and you don’t have liability insurance, you may have to pay for medical bills, property damage repairs and legal fees.

Renters insurance can pay for temporary accommodation

Suppose a problem covered by your policy makes your rental unit uninhabitable. The additional living expenses portion of your renter’s insurance policy may cover expenses such as hotel bills, restaurant meals, and other services, such as pet boarding or laundry services.

For example, if a pipe accidentally bursts and you can’t live in your home while your landlord makes repairs, you can tap into your ALE coverage to pay for temporary housing.

Renters insurance covers minor injuries to others

Another overlooked aspect of renters insurance is coverage for medical payments to others. It is generally used to cover small medical bills, regardless of who is responsible for an accident. It is usually sold in small quantities between $1,000 and $5,000.

For example, if your guest needs stitches after accidentally hitting their head against an open cabinet door, your medical payments to others coverage may pay for the trip to emergency care.

You can’t rely on your landlord’s insurance

If something goes wrong like fire or theft, you can’t make a claim against your landlord’s insurance to replace your belongings or pay for a hotel room. This is because landlord insurance covers your landlord’s interests, such as the structure of the building and your landlord’s property, not yours.

Homeowner’s insurance covers accidental property damage and injury to others, but this is generally limited to accidents that occur in common areas. For example, if a guest is injured on a staircase outside your apartment, this will usually fall under your landlord’s liability insurance.

Is tenant insurance compulsory?

Tenant insurance is not required by law, but a landlord may require you to have tenant insurance as a condition of the lease.

Even if your landlord doesn’t require tenant insurance, it’s still a good idea. Without it, you’ll have to pay out of pocket to replace belongings if they’re stolen or damaged by covered issues, like fire, and miss out on coverage for accidental injury or property damage to others.

How much does tenant insurance cost?

The national average cost for renters insurance is $125 per year, according to a Forbes Advisor analysis of renter’s insurance rates. That’s for $15,000 of personal property coverage, $100,000 of liability coverage, and a $2,000 deductible.

Here is a guide to the cost of renters insurance in your state.

How do I take out tenant insurance?

Here’s how to get tenant insurance in five easy steps:

  • Understand what is covered. Renters insurance can be divided into three main types of coverage: personal property coverage, liability insurance, and additional living expenses.
  • Determine your coverage amounts. The next step is to determine how much renter’s insurance you will need. Here is where this home inventory will come in handy. You can adjust your additional living expenses and liability coverage as needed. It’s a good idea to carry enough liability insurance to cover what might be taken away from you in a lawsuit.
  • Research renters insurance companies. The best tenant insurance companies combine fair prices with good customer service. Also be sure to check for available discounts.
  • Compare renters insurance quotes. You can get free quotes from a renters insurance company‘s website or by using a comparison site that can generate multiple quotes at once. If you prefer to talk to someone, an independent insurance agent can help.
  • Apply for a policy. Once you’ve found a company that offers the coverage you need and a price that’s right for you, it’s time to get a policy. You can usually apply for a policy on most insurance company websites. If your application is accepted, you can usually make your first payment and receive coverage the same day.

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