I Don’t Own the Apartment. What Do I have to Lose? Why Renters Insurance is More Valuable Than You May Think.

If you’re renting an apartment, you may think that you don’t have much financially invested into the property. What you may not realize, however, is that in the event of a disaster, you could be financially liable for more than you think. Do not make the mistake of thinking that your landlord’s insurance policy will protect you from all lost or ruined belongings. You could still find yourself liable for significant costs associated with unexpected damages to furniture or valuables, or for an accidental injury that occurs to a guest in your apartment. As protection against such financial consequences, renters insurance may be a valuable and affordable option to safeguard your personal investments.

As a tenant, even though you do not own the property and even though the landlord carries an insurance policy, there are still scenarios where you are financially liable if a disaster occurs. For example:

  • If your apartment building is destroyed by fire and all of your personal items are ruined, you will have to pay to replace those belongings, and may need to pay for a new permanent, or temporary place to live.
  • If a natural disaster, such as hail or a tornado, strikes and damages your personal property, such as a grill or patio furniture, you may need to pay to replace the damaged items.
  • If your apartment is vandalized, you may have to pay to replace stolen items such as a laptop or flat screen television.
  • If a pipe bursts and your apartment floods, ruining your furniture, you will need to pay to replace ruined items.
  • If a guest in your apartment slips and falls on the steps and sues you for his injuries, you may be responsible to pay the cost of medical care.

Under these scenarios you, and not your landlord, would be responsible for paying to replace damaged or lost items, or paying for medical costs associated with an accidental injury. Renters insurance, however, can protect you in such instances:

  • In the case of a fire or flood, renters insurance will help you pay to replace damaged furniture and belongings. Renters insurance may also help you to pay for temporary living expenses if you need to relocate to a hotel or other temporary housing location.
  • In the case of a natural disaster, renters insurance can help you pay to replace damaged property.
  • If a thief breaks into your apartment, renters insurance can help you pay the cost to replace lost items, as long as they are listed in your policy and you meet the coverage limits.
  • If a guest suffers an injury in your apartment, a rental insurance policy that includes liability protection may cover the cost of medical care to compensate the injured individual.

Renters insurance is extremely affordable, especially for first time renters. Depending on the policy type and deductible selected, the cost of renters insurance may average only a few hundred dollars a year for $500,000 of liability coverage and $20,000 of property coverage. Speak with your independent insurance agent to determine which policy may best suite your needs based on your belongings and their value. Discuss with your agent what protections specifically apply to tenants and landlords in your state, and decide what deductible level will best suite your needs. Remember that while higher deductibles can decrease the annual cost of coverage, you will be liable for more upfront costs out-of-pocket if an incident does occur.