5 Reasons to Purchase Renters Insurance

As any homeowner can tell you, having a homeowner's insurance policy gives you peace of mind and some protection against the unexpected. But not many renters would say the same about renter's insurance. That goes a long way toward explaining why an estimated 95% of homeowners have such a policy while a mere 41% of renters do.

But the fact of the matter is that purchasing renters insurance is an excellent idea in almost every case. It provides some valuable coverage that many renters aren't even aware of, and can become a lifesaver in the event of a fire or flood. To explain why that is, here are five reasons to purchase renters insurance.

1. It Offers Liability Protection

Although plenty of renters don't realize it, they are responsible for any accidents that happen inside their apartments. So, should a guest come over and injure themselves – the renter is on the hook for damages if the guest decides to sue. And that's not all. Renters with pets also should know that if their pet harms or injures anyone within their apartment – even if it's inadvertent – they are liable for whatever happens. And when you consider that the average personal injury settlement in the US ranges from $3,000 to $75,000, ending up paying for damages out of pocket can be catastrophic financially.

2. It Will Pay to Repair or Replace Stolen Items

Like homeowners, renters consider their homes inviolable. But that won't deter burglars from breaking in and helping themselves to a renter's personal property. And that's a very big deal. The average two-bedroom apartment contains around $30,000 worth of property – and losing even a fraction of it in a robbery can be quite expensive. With an appropriate renters insurance policy, a renter will get reimbursed for their losses right away so they can get on with their lives in the aftermath of a robbery.

3. It's Often Required by Landlords

Even though most states don't have laws requiring renters to carry renters insurance, that doesn't mean that every renter can go without it. Many landlords include clauses in their standard lease forms that require tenants to purchase a certain amount of coverage in a renters insurance policy. This is because the owner's insurance only covers the property and the structures on it – and explicitly won't reimburse tenants for their losses in most situations. By making renters insurance a requirement, landlords make sure tenants have coverage and limit their liability in the event of losses by a tenant. They can even evict tenants found to violate that lease requirement.

4. It can Cover Property Outside of an Apartment

Although most people assume that renters insurance only provides coverage for an apartment and the things inside of it, that's not always the case. Many renters insurance policies also cover personal property stored outside the home, like in a storage facility or a car or trailer. This is because a renters insurance policy insures the belongings of the policyholder – not the apartment they live in – so it is still in effect if those belongings aren't at home. It's an aspect of renters insurance that most people, and even current policyholders, might not be aware of.

5. It's Inexpensive and Easy to Get

Last but not least, the most important reason to buy renters insurance is that it's extremely inexpensive and easy to get. The average cost of a policy in the US is just $14 per month – and that typically provides $30,000 in property coverage and $100,000 in liability coverage. Given how much a single covered event might cost a renter – they'd be crazy not to purchase coverage. And it's not always even necessary to make a long-term commitment to a policy. AZ renters insurance, for example, is available in short and long-term policies. That means residents can purchase a policy to cover a holiday rental even if they're only going to be using it for a few days!

The Bottom Line

Considering all of the benefits that come with having a renters insurance policy, it's hard to believe that so few Americans purchase them. They make good sense no matter how you look at them. But with some luck, the reasons to own one covered here will open some eyes and convince renters to go find a policy that's right for them. The first time they ever have to use it – it'll pay for itself.