WTF is renters insurance really, and do I need it?

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By: David HilowitzCC BY 2.0
I live in an apartment, but it doesn’t explicitly require renters insurance. I’ve been renting my own places for four years now, and have gone without it. It seemed like a good thing to have, but not something to prioritize as a working (sometimes struggling) artist.

That said, I have a more stable income these days, and an apartment full of camera gear, and my partner’s extensive video game collection. We live in a neighborhood that’s been making headlines lately for a rash of daytime robberies, so it’s been on my mind a lot lately.

But I really know absolutely nothing about where to start, what to look out for, and what it actually covers. I think it’s time to finally make the leap, and level up in adulthood.

Can y’all help a Homie out and break down what your experiences have been, and any advice you have on renters insurance? It’ll be much appreciated! –Tyler

Comments on WTF is renters insurance really, and do I need it?

  1. If you use your photo gear for business purposes, you may need business insurance to cover it, so be sure to ask about that from your renter’s insurance company. A friend of mine is a wedding photographer and had all his gear stolen from his car. Renter’s insurance did not cover it because it was used for business (he was just starting out and didn’t have business insurance yet). Not sure if you use your photo gear to make money, but you mentioned being an artist. If you sell your photography or use it in your artwork or make money off it in any way, you’ll most likely need business insurance. Just something to think about. That being said, if you do use it for your income, can you really afford to replace it on your own if something happens to it? Insurance is likely cheaper.

  2. Also going to hop on the “get insurance” bandwagon. Every place I rented required it for liability coverage, but think about it: how much do you trust yourself, your roommate, your pets, your neighbors, and the local criminals? I mean, I know myself and that I’m a pretty safe and careful person who’s not likely to burn the place down, but I don’t know that about the folks who live downstairs from me (or their guests). All it takes is one neighbor to fall asleep with a cigarette (happened to a coworker of mine) or an unsupervised toddler in a bathroom upstairs to destroy your apartment. Just like any other type of insurance, better safe than sorry.

  3. Get it. When I rented, I had it through my car insurance (State Farm) and it was less than fifteen dollars a month. And yes, I realize that when you’re young and broke that can seem like a lot…it did to me at the time but I did it because my dad is Captain Disaster and he nagged the shit out of me about it. I was happy to have it, though, on more than one occasion. I have tenants now in property I own, and though I don’t make them buy it I strongly encourage it. I was also employed by a property management company for several years, and I saw it save people lots of heartache and money multiple times.

    Make sure you have photographs of all your valuable stuff, documented, on a USB drive that you keep somewhere other than your house (like in your glove compartment or your desk at work) just in case, and read the fine print to make sure that everything is covered. (Some insurance policies require extra coverage to be purchased for really valuable things like jewelry or antiques)

    • Just something to consider: a tenant causes damage to your building. They don’t have renters so your policy must cover the damage. You pay your deductible and your loss history now shows a claim. If your tenants are descent they may pay you back for the deductible but they can’t erase your loss history. With too many losses your company may cancel you then getting a new policy through a new company will be much more expensive because you are seen as a higher risk due to the claim(s). Renters insurance protects the owner of the property too.

    • You may want to reconsider requiring tenants to have renters insurance. It protects you too. If they cause damage to your building and your policy covers it, you pay the deductible and your loss history will be tarnished. Maybe you are fortunate and the tenants pay back the deductible but they can’t erase that loss history. With too many claims your company will either A. Require you to increase your deductible or B. Cancel/non-renew your policy. It is harder and more expensive to get a policy when you already have claims on your loss history. Most companies will look back 3-5 years.

  4. Totally get renters insurance, in NZ we call it contents insurance but it includes legal liability cover which everyone should have. I have heard far too many horror stories in regards to people not having insurance and then losing everything to a fire and having to pay back hundreds of thousands of dollars in repairs and replacing their belongings. You may not think you have much but if you lost everything in your house think how much it could cost to replace it and I’m not talking what you paid for it but replacing (which if you got it second had or on a massive sale card vary a lot). I know it would of cost me about 10,000 to replace everything in my room when I was flatting, clothing and shoe costs a lot when you have to replace it all at once, then books, beds, bedding, draws, desk, make up, jewellery, rugs, computer.

    • Yup – remember those students in Dunedin? One had some bacon on the stove, popped over next door to beg a tomato, came back and the house was burning down.

      And all of the students on the lease were held liable for something like $200,000 of damage. So it’s not even about you being careful (and trusting to luck) – it’s about having that level of faith in your flatmates/roommates as well. No thanks!

      Not worth the risk not to have it IMO. I don’t think I could have replaced even just a room’s worth of stuff – clothes, bedding, towels, bed, furniture, computer, etc. – for less than $8k either.

  5. I am the poster child for why renters should have insurance. I got it when I lived with a lunatic and I didn’t trust her not to burn the house down while she smoked out her window but it actually came in handy a year later. Three weeks after our wedding, Hurricane Sandy rolled through CT and dropped a tree on the cottage my husband and I had just moved into. Renters insurance paid for a hotel, clothes and dog supplies since everything was stuck in the house for several days, covered the cost of all the wasted food from the powerless fridge. It even paid for our eventual move to OH. The whole situation was heart-breaking and super stressful but having so much covered made it easier. It’s not that expensive and even if your budget is crazy tight, find room for renters insurance!

  6. I recommend it. I use to live in Philly and lived in the “nice” neighborhood. Even with that, my apartment got broken into. Oddly nothing got stolen. I had a family who lived in a really gentrified area and their neighbors made the new since the row house got broken into. So don’t think “I live in a nice neighborhood, I should be fine!” Sometimes the nice areas get targeted.

    That said I know with our insurance we had to estimate how much stuff we own, and list a price. Unless you have literally nothing of value (ie you are sleeping on the floor and own only clothing) it is worth getting.

      • Thanks for the head’s up JenniferJuniper. I looked into those companies’ policies. But I was hoping for a recommendation of one company over another. Most of the policies seem fairly comparable, so I’m having a hard time choosing one.

    • Policies vary from area to area. I would go to 2 places to ask for local recommendations: your bank, and HR for where you work. Otherwise, find an independent agent who has experience with all the local policies and can explain the differences.

  7. I say get insurance and get it now – it doesn’t only cover robbery, it also usually covers other crazy events such as flood or fire. It’s also very cheap, the policies that I’ve had over the years renting were under $100 per year, the last one was $8 per month.

    But now, I have a story: Our apartment caught fire one morning when no one was home. We were lucky, no humans were hurt and a lot of our things were able to be cleaned and saved. At the time we had no renters insurance, which is a whole other story, and so we had no official route to go to for help paying to replace/clean our stuff. This sucked… what was worse was that we were later sent an itemized bill for the damage to the apartment. The fire was ruled no fault, and while the apartment complex had their own property insurance to cover the damage to the building and rebuild the unit – they went after us first. They were well within their legal right to do that and charge us that money, however we were not at fault and so the charges would not have been likely to stick in court. We had to obtain our own lawyer to send a letter telling them we weren’t sending them any money. If the fire had been from an unattended candle, a pot left on the stove, the cat tearing apart a cord causing it to short or whatever – if the fire had been ruled our fault, we could have been held liable for a whole lot of money. And so the moral of the story is: renter’s insurance is cheap, and sh*t happens. make sure you pay your bill on time.

  8. I have renter’s insurance because my apartment complex requires it, and my previous apartment complex did too. I didn’t really choose the company, I just went with the one that already had everything set up with the complex. Still cheap, still does what it’s supposed to do, and they already know the value and details about the apartment.

    That said, we had a flood in our apartment last year due to burst pipes (probably our neighbor’s fault, but also the winter was terrible). It was hugely annoying, though we were lucky not to have anything seriously damaged. We lost the use of half our apartment for several weeks while damage to the ceiling was being repaired, though, and we could have gotten reimbursed for that, but the reimbursement (based on unusable square footage) would have been so little that it was barely worth it. Our rate would have increased probably more than we would have been reimbursed. So, I get that renter’s insurance would be excellent in the event that valuable things get destroyed or the whole apartment becomes unusable, but for us it wasn’t really that useful even though we had a mini-catastrophe.

  9. Please, for the love of all that is good, get renters insurance.

    You will hopefully never need it, but if something completely random happens, say, you live in an apartment building and there is an explosion in the apartment above you that incinerates half your belongings as well as your roof and outer walls (which would have killed you had you been home), you will find renters insurance super handy.

    This senario above played out with my sister in law. They did not have renters insurance. The three of them had to move into one of our bedrooms (6 people living in a 2 bedroom, yay!) for a few months and they had to rely on charity to replace all of their belongings.

    While they got a little help from the responsible party, insurance would have hooked them up with living expenses, a hotel, money for food and clothing and basically helped them get back on their feet.

    I didn’t have insurance either, but I got it immediately afterwards and it turned out that my car insurance went down when I bundled them, so I was effectively paying less money for twice the insurance!

    Just do it and do it now!

  10. I wish I could imbed a photo of what happened at one apartment complex I lived at several years ago… I was showering one night and noticed the water pressure was dropping severely so I hurriedly ended my shower, got out, and continued getting ready for bed. While I was getting ready I noticed that I heard a lot of noise from across the street (still within my apartment complex) and lo and behold, the WHOLE building across from me was on fire. The only reason I didn’t notice sooner or worry about my building is because I was on the other side of the “main” road going through the complex. I watched that building burn for two hours… It was horrible… The top two floors lost EVERYTHING due to being torched and the lowest floor probably lost everything due to water and smoke damage. All told, 80 people were made homeless all due to someone flicking a cigarette into a bush from their balcony. Luckily, no one was hurt.

    TL/DR – A fire gutted an apartment building near mine and I’ve had renters insurance ever since.

    EDIT – Here’s a video I found of the fire:

  11. I second, and third, etc., what everyone else has said about renters’ insurance. I’ve never needed to use it, but I probably would have wasted the $140/yr or whatever it is that I would have saved by skipping it anyway.

    A benign story about the value of insurance: A friend and her roommates were drinking cocktails once on the roof of their 6-story apartment. One roommate had a few too many (as one does) and fell off the roof (as one does). He landed on the AC unit of the building next store. Remarkably, he got up and laughed about it, but the unit was trashed. What would have been a major expense was covered by his renters’ insurance. It wasn’t a huge deal, but renter’s insurance made it a non-issue.

    I’m not sure if that’s standard policy coverage, or if he had to swing that, or if he was paying for a no-deductible policy or what, but still. It’s a small thing that would be a hassle or a setback to anyone, but because he paid his renters’ insurance, it was just a funny story.

    Another reason I definitely have it: I live in LA, where earthquakes are a pretty standard occurrence. Even a small one can knock things down and break them, and according to my insurance agent, most things that might get destroyed in an earthquake are covered. If plates crash against the countertop, it’s not the earthquake that destroyed them; it’s actually the COUNTERTOP. If my TV hits the floor and shatters, my insurance covers it because the damage is floor damage, not earthquake damage. Now, if my TV broke apart because the wall separated during an earthquake, that would NOT be covered, since that’s earthquake damage. Earthquake insurance for buildings is a totally different animal and something (thankfully) I don’t need to know about. But for a renter, renter’s insurance is helpful in earthquakes, too. (I am totally taking my agent’s word for this. He did explain this after I’d already committed to purchasing renter’s insurance. If anyone knows better, let me know.)

    Renters insurance costs like $16 a month not bundled with car insurance, and it just makes me less anxious about bike thieves, burglars, earthquakes, and the fact that my landlord still hasn’t put a fire door on my water heater. In my opinion, rich people are more likely to avoid these issues with their fancy security systems and retro-fitting and fire doors. But it’s those of us who can afford neither prevention nor replacement who need insurance.

    As for details, I have actually found that bigger companies work better for insurance. It’s just the nature of the game: the more people you cover over a more diverse area, the cheaper your insurance can be and the better your coverage. My insurer, State Farm, was great when my car was totaled. Though I don’t know how they’d be in a renter’s insurance issue, they’ve earned my loyalty for the next few years.

    Also check with your bank– I think Wells Fargo offers minimal coverage for $12 or $13 a month, which I would have gotten if I weren’t happy bundling my insurance with State Farm. So check the major companies and your bank, and expect to pay between $12 and $20/month.

    If you have expensive equipment, maybe get a more complete policy. Personally, my thoughts are that $25,000 (which I think is pretty standard coverage) can cover me starting my consumer life over. If you share walls with someone, ask specifically about “damage to the property of others”. My coverage for that is only $500, and I might actually get that increased. Also note that certain equipment has limits on the coverage. More than a couple thousand dollars worth of electronics, guns, jewelry, or furs might require extra coverage. Definitely talk to an agent about those.

    In short, definitely get some, and try talking to a couple agents about it. They should be able to offer you good information.

  12. Just last Sat the 20th a couple friends of ours lost everything in a fire musical instruments and recordings they didn’t have renters insurance. We are having a benefit to help them rebuild. We can’t replace the recordings from their band or the comic book collection. It may never happen to you I never had it but you never know.

  13. Renter’s insurance is typically cheap on its own, but is awesome if you can bundle it (car insurance, life insurance, etc). We’re currently breaking even with our multi-line discount.
    A few years back, the duplex my S.O. was living in caught on fire while he was at work. The fire started in his neighbor’s unit – who was away on vacation at the time. The building was burning for some time before the neighbors across the road noticed and called for the fire department. The damage was pretty extensive (the neighbor’s side of the building was practically gone). Although the fire was contained before it spread to my S.O.’s side of the building, he still had a lot of smoke and water damage. The restoration service his insurance hired was amazing (they de-smelled his books and paperwork, washed and dry cleaned all the clothing, etc), however a lot of items were unsalvageable – mostly kitchen items that were made with plastic or had non-stick coating on them, food, toiletries, the mattress set… It added up FAST. It’s one of those things you cannot fully wrap your head around until you begin to itemize everything.
    Beyond replacing the items, his insurance people helped direct him every step of the way – from filing claims, finding a place to live temporarily, next steps, etc. Sometimes during stressful situations it’s hard to keep a clear head and think straight. Having that support was an added bonus.
    Definitely photograph your belongings to prove that they were there. If you’re an overachiever, make a note of model numbers too. His insurance adjuster suggested listing those, plus it makes it easier to find a replacement. We now currently keep a running list via Google Docs whenever we bring a “big ticket” item into our house, with the model number and date purchased listed with an item description.

  14. My sister had a fire in the apartment unit next to hers. While her unit didn’t have any fire damage, everything in her unit was a write off due to either smoke or water damage. The fire in the unit next to hers was intentionally set, turning the whole building in to a crime scene and as a result she couldn’t get her car from the parking garage until the fire marshal and the police had finished their investigations.
    Her policy replaced everything in her unit from clothes, furniture, dishes, electronics, hotel, meal and her work equipment to a rental car until she could get hers back.
    Paying a few dollars a month may seem pointless until the unthinkable happens and all of a sudden you are on the hook for major expenses.
    Invest in a fireproof safe for valuables and important documents and take pictures of your apartment and any valuables that will not fit in a safe.

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