Relocating to a new city and starting fresh is exciting. Unfortunately, there may be some uncertainties while moving, such as a new location to reside, a new set-up for your home and the creation of utility accounts for gas and electricity. Above that, your landlord may request that you have renters insurance.
“Wait a minute? Do I need that too?” you might wonder. In recent years, renters insurance has become increasingly more popular. According to research, 57% of U.S. households are insured, which amounts to 25 million American homes. To address the question, renters insurance is not mandatory, depending on where you intend to relocate.
If your destination is California, you are not required by law to get this property insurance. Notwithstanding, your landlord may ask for it. Taking that into consideration, let’s find out what this insurance offers.
In simple terms, renters insurance, also known as contents-only insurance, is a protection plan against theft, fire, burglary and vandalism of one’s belongings. When in search of your dream home, you want to ensure that your personal items are protected, especially if the property nestles in a neighbourhood prone to such dangers.
While your landlord is liable for damage to the property, resulting from wear and tear (save for inadvertent or intentional damage by you), you are responsible for any loss or damage to your furniture, clothing, home appliances, and other valuables. And since they are worth a fortune, it is in your best interest to get renters coverage.
Not all landlords request this, so if yours doesn’t, you don’t necessarily have to get it. But then, you need to be on the safe side. Having it doesn’t only benefit you, but your landlord as well. Let’s find out how.
Although your current lease may not include this clause, it may be required of you during renewal. In fact, the registered proprietor may request to be added to the insurance as an additional insured. If this puzzles you, here are some reasons to consider.
No landlord wants to become the plaintiff for damages or loss caused to a tenant’s personal items. Besides, it isn’t uncommon for the latter to argue that the former had let the premises become susceptible to hazards. A landlord who fails to remedy a water leak that destroys a renter’s furniture can be sued for damages. It’s no different from a fire caused by defective wiring in the property, even if the owner didn’t conduct the electrical installation.
To avoid such unfortunate situations, most landlords call for renters insurance. In the event of such cases, the policy will cover the replacement cost of lost and damaged belongings. Your landlord won’t have to pay out of pocket and can, therefore, continue to rent the unit out in peace.
Perhaps, a fire or water leak may have rendered your rented unit inhabitable. As a tenant, you may not have an alternative place to move to. If this is the case, your landlord will ask you to stay somewhere else, such as a hotel, while the unit is being renovated. This, though, can be quite expensive and time-consuming.
Renters insurance can take care of such scenarios. Your landlord won’t have to cover the cost of your temporary accommodation. What’s more, they can get paid for the lost rental income, if you can’t move into the premises as soon as the damage has been fixed.
This factor is highly beneficial to property owners. If a property’s structure is damaged, the home insurance will cover the cost of repair. However, the owner would need to pay a deductible, an out-of-pocket expense, before the insurer pays up. This amount typically ranges from $500 to $2,000. If a tenant has renters insurance, this coverage takes care of such costs.
An insurance company will often request that a property owner take specific measures to mitigate litigations and keep premiums affordable. This includes, but is not limited to, the requirement of renters insurance. So, if your landlord tells you to get this coverage, bear in mind that the individual’s insurer may have influenced this decision, and it’s in your best interest to oblige.
Property owners often screen prospective tenants for suitability and one of the requirements is renters insurance. This measure helps to avoid renters who pose a risk to apartments. A tenant with bad records of payment and damage to the property can incur a huge financial loss for the landlord, which may result in increased premiums.
To avoid such red flags, a landlord will usually require a prospective tenant to obtain renters insurance.
Contents-only insurance coverage is pocket-friendly, costing $17 per month, on average. Some insurers offer discounts when you pay for a full year of coverage in advance, set up automatic bill payments or apply under regarded professions, like nursing and teaching. Despite the relatively small price, this policy covers your valuable personal items.
The insurance includes personal belongings, liability, and additional living expenses. This also means that if the landlord’s negligence caused damage to your personal items, you’d be compensated. In addition, if a person is injured on your premises, you will be protected from liability.
It’s worth mentioning that your credit score might influence your insurance premium. This is because insurers determine the risks involved in insuring tenants based on their credit rating. With high credit scores, you can get cheap renters insurance policy, while low scores may increase the premiums.
If you are not satisfied with your current renters insurance provider, compare several other insurers and find the best deals.
When it comes to insuring your personal belongings, we all know that you can’t put a price tag on them. If you lost everything you owned, including your jewellery and high-value appliances, would you have the money to replace them immediately? Thus, it’s safe to say that renters insurance is a must-have. Even if you don’t personally need it, your landlord will, so it’s advisable to acquire this policy.
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