When you rent a property, you can buy renters insurance. These policies protect you in two different ways. First, if the belongings in your rental property get stolen or destroyed, the rental insurance will replace them. Second, if someone gets hurt in your rental home and sues you, the rental insurance will protect you. By offering both these areas of coverage, a renters insurance policy is worth its cost.
Whether an insurance policy is worth buying depends on the size of the risk it is covering. You want to insure assets that you couldn’t afford to replace on your own. This is why you would buy insurance on your house but not on a $20 pair of pants.
If renters insurance just covered your belongings, it would be a close call. Renters insurance is fairly inexpensive but replacing your personal property is a fairly low cost. While it’s nice to have all your belongings protected, this is the type of risk you can insure yourself with your own savings.
The potentially greater value of rental insurance is its liability coverage. If someone sues you and wins a judgement, you can potentially lose everything you own. By making a small investment in renters insurance, you protect yourself against the rare but catastrophic risk.
When you consider both sides of renters insurance, this coverage makes sense. By making this small investment, you make sure that your rented home won’t ruin you financially.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
All insurance is a matter of statistics. If you have the financial resources to cover the loss of all your personal property and pay the expense of a lawsuit for personal injury or property damage that comes from renting a unit, then you don’t need a renter’s policy. However, if you cannot meet those obligations a renter’s policy provides an inexpensive alternative. You then share that risk with thousands of other renters.
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Whether an insurance policy is worth buying depends on the size of the risk it is covering. You want to insure assets that you couldn’t afford to replace on your own. This is why you would buy insurance on your house but not on a $20 pair of pants.
If renters insurance just covered your belongings, it would be a close call. Renters insurance is fairly inexpensive but replacing your personal property is a fairly low cost. While it’s nice to have all your belongings protected, this is the type of risk you can insure yourself with your own savings.
The potentially greater value of rental insurance is its liability coverage. If someone sues you and wins a judgement, you can potentially lose everything you own. By making a small investment in renters insurance, you protect yourself against the rare but catastrophic risk.
When you consider both sides of renters insurance, this coverage makes sense. By making this small investment, you make sure that your rented home won’t ruin you financially.