One cost that many new renters attempt to avoid is that of renters insurance. Many first time renters simply believe that either a) the landlord’s insurance covers the building anyways or b) that it is a waste of money.
Both of these are misconceptions.
The insurance the landlord or property only covers the cost of fixing any damages the building itself may incur. This means that the building insurance does not in any way cover the costs of personal property owned by tenants.
The second misconception, that insurance is a waste of money, is untrue for a number of reasons. The first being that many property management groups will not rent to someone without renters insurance. This is because they want to ensure their tenants are protected in case any sort of damages where to occur. This means that in many cases, in order to rent an apartment, you need to have proof of having renters insurance.
The other, more obvious reason renter’s insurance isn’t a waste of money is due to the fact that it is there to protect your personal finances in case your property is damaged. Though you may think that your stuff isn’t very expensive which makes it not worth paying for renters insurance, this may not be an inaccurate understanding of the situation. Renters insurance does not just cover the few expensive items you own, it covers everything you own. If there is a circumstance that damages your property, the total cost of replacing items you once owned will likely be far above that of a monthly insurance payment.
Think about how much it would cost to replace all of your clothes, furniture, electronics, kitchenware, and anything else you might own. Being insured protects you from the possibility of having to purchase everything you used to own with money from your own pocket.
If you currently drive a car which is insured, you can usually add renters insurance through the same company at a nominal fee. Other sources of renters insurance can purchased through many of the main banks. Renter’s insurance is key to ensuring financial safety that in itself makes renter’s insurance worth every penny.