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6 Myths About Renter Insurance and Why You Need It

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Insurance is a necessity, something you hope you never need to use but are so glad when its there. So why do some think renter insurance isn't as important as auto, life, or health insurance? We've debunked some common myths about renter insurance and have explained why you do need it. 

Myth: My landlord has insurance, so I don't need it.

Hopefully, your landlord has homeowners insurance, which protects them from any damages or accidents. But it only protects the building. What's inside the building is protected by your renter insurance. The same goes for personal liability that comes with homeowners or renter insurance. That liability coverage protects the person paying for the insurance. 

Myth: I live on the installation, and the military covers my renter insurance.

Well, this used to be true, but in 2015 the Department of Defense removed the renter insurance portion of the basic housing allowance. And, even while the BAH included renter insurance, it capped out at $40,000 and may not have covered an entire house worth of belongings. 

Myth: It isn't worth the cost.

You may think that you don't have much, but if you ever tried to replace everything in your house completely, you'd be surprised at how much it costs. An average person living in an apartment has $20,000 worth of belongings. The couch is probably close to $500. The television, another couple of hundred, and the closet full of clothes? Things add up quickly. For the relatively low average cost of $120 to $190 a year, you can have renter insurance that covers your personal liability and possessions. 

Myth: I've never needed it before, so I won't need it now.

No. Of course, you don't ever set out intending to have a house fire or have someone slip on the sidewalk and sue you. But accidents happen. And that's why insurance exists. Third-party liability insurance can protect you from paying big if someone gets hurt on your property. And even if your dog bites someone. There are a lot of things your renter insurance can cover that you hopefully won't need, but will be glad to have in case you do. 

Myth: My landlord will pay for my hotel.

No. If you have to leave your rental because it requires repairs, or you must leave while waiting on a settlement, your landlord is not responsible for paying for your hotel expenses. This is an area where renter insurance comes in very handy, and an area of coverage that most people miss. Your insurance provider will help to cover your living expenses while repairs are being made in the case of an accident. This will be a huge financial help, especially if repairs or settlement extends beyond a few days. 

Myth: The landlord's insurance covers all of the updates I made. 

No. The landlord's homeowners insurance covers their building and whatever improvements or upgrades they make. But it doesn't cover what you have done. So while you received permission to put in a new closet, that small section is not covered under the homeowners policy. So if something happened and destroyed that section, you would not receive any coverage or reimbursement for damages in that area. 

Renter insurance is an affordable way and a great way to protect yourself and your possessions when not owning a home. You wouldn't think about driving a car without insurance, or letting our health insurance lapse, would you? Renter insurance is just as essential and costs far less. Contact your AFI representative for more information about your coverage or about starting renter insurance.