Tenants are much less likely than homeowners to have home and contents insurance. But there’s no reason why tenants should be putting themselves in a position where they could be out of pocket from risk of theft and accidental damage. In fact, according to the Insurance Council of Australia, three quarters of Australia’s renters do not have contents insurance, however they are twice as likely to need to make a claim for theft or burglary than a home owner.
One misconception from tenants is that they assume their belongings are covered by their landlord’s policy. This is incorrect. The tenant is responsible for their contents in the property. The landlord is responsible for insuring the building and any furnishings provided. And for those young tenants, you should not assume you are covered by your parent’s insurance either, because you’re not.
A common reason for renters not to take out home contents insurance is the high cost, not having enough possessions to make it worth the while, and the fact that it is not considered an ‘essential’.
For many young people balancing increasing rents, credit card debts and the general rise of cost of living, home contents insurance can often be the first expense to go.
Scrimping on insurance is a false economy. Once you take stock of just how much your possessions are worth, paying for home contents insurance to protect your possessions will seem worth it if anything should happen to your belongings later down the track.
You don’t want to be in a position where it’s too late and you are kicking yourself for not taking out a home contents insurance policy. Don’t put your personal belongings at risk: insure!
Here are 4 reasons to consider purchasing renter’s insurance
Whilst you might be living in someone’s else’s property, this place is still your home. It’s filled with all your items, your laptop, your bed…your stuff and these possessions are valuable to you. So what happens if someone breaks in and steals your computer or television, or you accidently set fire to the kitchen? In many instances you aren’t covered by your landlord’s insurance so without your own insurance you could come face to face with a whole lot of debt.
Theft
Imagine coming home to find your property has been broken into and your computer,
jewellery and your granny’s favourite silver tea pot have been stolen– many of these items are irreplaceable, however most policy’s cover objects due to theft along with any damage caused to other items during the robbery
Fire
Imagine coming home one evening and find that your neighbour’s heater caused a fire and whilst your apartment is not destroyed, all your contents are damaged by smoke. Renters insurance can pay fire damage on belongings and in many cases will pay for you to stay somewhere else while the damage is repaired. Be aware insurance policies don’t cover cigarette burns or scorch marks.
Water damage
A water pipe has burst in your ceiling while you are at work and you come home to find your bed and favourite arm chair have been destroyed. Whilst your landlord’s insurance will pay to repair the apartment it doesn’t usually cover your personal belongings. Renters insurance will pay to either repair the bed and arm chair or replace them if they are totally destroyed.
Personal injury
If a visiting friend injures themselves in your home, in most cases you will be covered for all or part of any legal and medical fees as a result of the injury at your address. Obviously your liability coverage will vary depending on your circumstances so make sure you check your policy or ask your insurance agent for details on how much your liability coverage is.
What affects the costs of renter’s insurance?
- The location of your home. For example, if you live in an area with a high crime rate or in an area that is bushfire prone you may need to pay a higher premium.
- If you have good home security such as window locks, cameras, an alarm or deadbolts this will help make your insurance cheaper. Perhaps ask your landlord if they will be prepared to invest in extra security as this will help reduce your monthly premiums…and there’s also.
- Your level of cover obviously effects how much you need to pay. If you include more optional extras the more your premiums will cost. So consider exactly what you want to insure, what’s valuable and what would cost you a lot to replace.
