You’re young and have just moved into your first apartment. You don’t have a lot of personal property: your television, a kitchen table and some chairs, your computer, a little bit of furniture in your living room, and your personal stuff in your bedroom. No need for you to get renter’s insurance, right? I mean, it would just be a waste of money and you don’t have that much to begin with. You don’t really need insurance until you’re a home owner. Right?
Wrong! For one thing, although it may not seem like you have that much money tied up in your meager belongings, look at it from another standpoint. If you lost everything in a fire, for example, how much would it cost for you to replace everything you own? Let’s start in the kitchen: even if all the appliances are owned by the landlord, you still have plates, silverware, glasses, coffee cups, cookware, your microwave, etc. Even if you’re living on a shoestring, you’ll have some sort of kitchen table and chairs, probably a coffee table and or some end tables in the living room, maybe a desk, and a couple of chairs or maybe a sofa.
Even in your bedroom and bathroom there’s more money than it seems. You have a bed, a dresser or chest of drawers or armoire, your clock radio, shoes, clothes, towels, sheets, blankets well, you see where I’m going with this. If you truly had to replace everything you own, you would be out some money probably more than you have; certainly more than you want to spend.
Even if you don’t “plan” to have anything happen (I love that terminology: and I have actually had people tell me they don’t “plan” to need insurance when I worked in an insurance agency), you should be prepared. You may be very careful and never have a grease fire, but what about the neighbor? Fires often spread quickly through apartment complexes. You could be an innocent victim.
But property damage is only part of the coverage under your renter’s insurance. Let’s say a fire does damage or destroy your apartment. Where are you going to live? Did you know that renter’s insurance will probably cover “loss of use” a provision that will pay (or at least help pay) for alternate living until your place is repaired or you are able to relocate?
Another coverage provided by your renter’s insurance is liability insurance. Let’s say your friend comes over, slips on your area rug, falls and cracks his head open on your coffee table? What if he doesn’t have any health insurance? What if he does have health insurance, but his insurer comes back to you because the feel you’re liable for his fall? Do you have the money to pay for his medical bills? Even if it’s not your fault, can you pay to go to court? Your renter’s insurance will provide coverage in the event you are liable for damage to someone else’s probably or responsible (directly or indirectly) for injury to another person. There may even be medical payments coverage that can be used should someone be injured in a way you feel morally responsible for, even if you’re not legally responsible.
Check into the cost of renter’s insurance in your area. You may find you can get a policy for less than you expected. And most likely, you can pay for it quarterly or even monthly, so it’s not so hard to afford it. Compare the cost of the insurance to the cost of replacing your property, paying to stay somewhere else while your apartment is uninhabitable and/or the cost of being sued for damages or injuries to others that you are responsible for. The premium is far more than you stand to lose. And the peace of mind that comes from knowing that paying for these contingencies doesn’t have to come out of your pocket is priceless.