Do You Really Need Renter’s Insurance?

The question posed in the title above is a widespread one and is often asked by those about to rent a property as a home or business space. The answer to the question is relatively straightforward and can be summed up in a single word: Yes.

Why? If you look at your rental agreement or lease, you’ll see something very interesting. Nowhere in most of these documents will you find the property owner or landlord responsible for:

  • Your belongings
  • Preventing or compensating you for damages or losses
  • Repairs or damages that you have caused

As one financial writer said, “to protect your belongings in case of fire, theft, or damage, you need your own policy…You also need liability coverage for damages caused by negligence.”

After all, let’s say you were tidying up before work, got distracted and walked out with a small stream of water still running in the kitchen sink. As the day progressed, the sink filled and overflowed. As the hours passed, the water seeped everywhere, including the neighbors’ homes. Because the source of the flood was your negligence, you’d actually be the one liable for the cost of repairs, replacing all of the lost or damaged belongings, and even medical bills that might be related to the issue. If someone sues you because of the flood, that too is out of your pocket. Having a good renter’s insurance policy, though, would protect you from all of that!

What is in a Renter’s Insurance Policy?
So, what is it that you can get from a policy? There are actually different issues that they can cover, and like all other kinds of insurance, there are separate deductibles and limits. The basics include:

  •  Your personal property – Coverage would replace or repair your belongings if they were damaged in a fire, by water, lost to theft or destroyed while in the home. Keep in mind, though, that just like a lot of homeowner’s plans, the renter’s insurance does not usually protect you from natural disasters like floods, earthquakes, and so on. You can buy separate policies for issues that could affect you (such as flood coverage for your apartment in a flood zone).
  • Liability – As we said, this is going to pay for property damage and bodily injuries due to your negligence. It could be a situation like the flooding mentioned, but it could be that your cat scratches a neighbor’s kid and your policy pays for the medical care.
  • Loss of use – You can also get your living expenses covered in the plan should an accident or damage force to you vacate. Let’s say a tree falls on the building and there are now weeks of repairs needed before you can return. This would be covered.

There is more to know about the potential coverage in a renter’s insurance plan, and you’ll want to talk to the experts at Allstate to develop the ideal coverage for your needs and your location.