Let's face it: renting can be very expensive, especially if you are moving out on your own for the first time. After subtracting rent, utility payments, and other monthly expenses, you can be left quite strapped for extra cash. This is why a higher percentage of renters drag their feet when it comes to getting tenant insurance.
But is that the right decision?
The collective response is usually, "I've gone this long without it and nothing has happened." But, what if the unlikely does happen? Here are a few key points to consider when debating whether or not to get renter's insurance.
Your landlord's insurance does not cover you or your personal belongings.
This is the most commonly held misconception about tenant insurance. Many think their landlord's insurance will cover them if there is any damage to their unit. But the landlord’s policy covers damage to the building, not tenants’ personal possessions. If you’re properly insured, you’re covered. However, if you’re uninsured, those costs come out of your own pocket. Once you start adding up expenses, you may find that you're running up quite the out-of-pocket tab.
Basic insurance coverage is great, but it may not be enough.
Some people opt for the cheapest tenant insurance available, but in most cases, it is far from enough in the event of an emergency. Once you've added up the cost of replacing all your furniture, televisions, electronics, jewelry, and clothes, and you'll likely gain an appreciation of how expensive replacing your items could be. Your personal possessions cost more than you may think, and without tenant insurance, they aren’t covered.
Not all insurance plans are created equally.
When shopping for an insurance plan, make sure you are choosing one that is suited to your lifestyle. If you have a lot of family heirlooms or one-of-a-kind pieces, it may be a good idea to choose a plan that would, at the very least, ease the pain of that loss with a generous payout. If you're unsure about the monetary ballpark you fall into in terms of needs, consider creating an itemized list of your belongings and attach a value to each one. This will give you a good idea of how much insurance you should get.
Piece of mind.
Nothing prepares you for a situation where you are potentially losing everything you own. But having the right policy for your needs is time well spent, so, if the worst-case scenario does occur, you're covered.