Many people skip purchasing renters insurance because it isn’t required and there aren’t any seemingly immediate consequences to not having it. But there are plenty of reasons why this type of insurance can come in handy. When someone else owns a property, they might carry insurance to cover costs in the case of damage to their property; their insurance doesn’t cover the cost of replacement to renters’ possessions, however. This means that if you are a renter, you might have material goods worth hundreds or even thousands of dollars that can be lost in an instant, with no way to cover the cost of damage.
Renters insurance can provide peace of mind that, in the event of an emergency or damage to property, financial costs are covered. Some common reasons people purchase a policy include:
Covers Replacement Costs of Possessions
One of the most obvious reasons to purchase a policy is to cover replacement costs of possessions if they are damaged or destroyed. Furniture, clothing, and the like can be lost to fires or natural disasters in an instant. Because people typically accumulate items slowly, it doesn’t seem like it would be that difficult to replace these items. If everything has to be replaced at once, however, the costs can add up to several thousand dollars.
Might Cover Temporary Living Expenses
Another popular reason to buy a policy is that it can temporarily take care of living expenses if an apartment is no longer usable because of a natural disaster, fire, or some other reason the policy covers. This makes being temporarily displaced easier to handle.
Covers Gaps in Other Types of Insurance
Sometimes there are things that you thought were covered under one type of insurance, but they’re really not. For instance, something might be stolen from your vehicle. Think your car insurance will cover it? It might not; many insurance policies have stringent guidelines for vehicular theft, many there are many cases where you might not be covered. Renters insurance could fill in the gaps in such policies.
Landlord Might Require It
There are some landlords who require their tenants to have insurance. Other times, it is the landlord’s insurance provider that insists that all tenants have it. This is to defer as much liability away from the landlord or landlord’s insurance company in the case of an accident, such as a fire.
Covers Items in Your Possession
What would happen if you rented something from a company or borrowed it from a friend, and then it was damaged? You might have to cover the cost out of pocket. Some renters insurance policies might be able to cover these instances, however.
It Is Versatile
One of the most popular reasons that people purchase a policy is because it can often be tailored to an individual renter’s specific needs. It’s natural to be afraid of spending money on something that no one wants to see him/herself ever needing, but several companies and insurance providers allow customers to pick and choose what works for them.