5 Common Myths About Renters Insurance - Debunked

5 Common Myths About Renters Insurance - Debunked

| April 17, 2022
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The requirement of renters insurance can seem daunting at first, and even unnecessary, if you believe these myths. 

Let’s take 5 common beliefs or myths about renters insurance. 

My roommate owns and lives in the house, therefore my stuff is protected.  False.

  • Your roommate would carry a homeowner’s policy, which would cover all items belonging to them. 
  • Your rent a room/space in their home.  Your belongings (furniture, clothing, stuff, etc.) are not your roommate's stuff.
  • To protect your belongings, a renters insurance (also called tenant insurance) is required. 

Renters insurance is too expensive.   False.

  • Most renter insurance policies are economical and budget friendly. 
  • While there are several options available, depending on the insurance company, most annual premiums average around $200.  That is less than $20 a month! 
  • Just think – simply choosing to to not eat lunch out for a days and you have saved enough to pay for your renters insurance each month!

My landlord/apartment complex will pay for my stuff. False. 

  • Only if your landlord/apartment complex was negligent or responsible for the damage to your apartment, rental house, or your belongings, then yes, there may be coverage for your stuff.
  • Depending on who is responsible for the damage caused, determines whose insurance pays. 
  • Common renters insurance claims:
    • leaving a candle burning unattended,
    • toilet overflowing water,
    • theft
    • injuries,
    • and break-ins. 

I do not have a whole lot of stuff in my apartment or my belongings aren’t expensive. False.

  • One of two of your items may not be costly, but what if all of your belongings were burned or damaged? 
  • Renters insurance can help fund you enough to start over:
    • to have the money available to get the basic items needed to start again
    • typical basic furniture (sofa, chair, table, chairs, bed)
    • typical appliances (stove, refrigerator, microwave, etc.)
    • clothes
    • dishes
    • pots and pans
    • flatware
    • cups
    • towels
    • toiletries
    • food, etc. 

I can go to a consignment/thrift shop to replace items.  True, but wouldyou? 

With a renter's insurance policy, there are two different coverage types to choose from.   

Actual Cash Value Replacement. (replacement cost - total depreciation)

  • New TV for $800.  
  • After 20 years, TV burns up in a covered fire.
  • The expected life of the TV is 30 years. 
  • The insurance company will calculate the value owed to you, the insured, minus depreciation.

Replacement Cost. 

  • New TV for $800 (replacement cost)
  • After 20 years, TV burns up in a covered fire.
  • The insurance company would pay for the full replacement cost of the set or replace it with a like-kind of TV in today’s market.  

Acquiring renters/tenants insurance may seem daunting at first, particularly when traversing it alone.  Having an insurance agent to help talk through the coverage options available and customize a policy to protect you and your belongings, is the way to go. 

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