Risky business — apartment owners skip the insurance
Imagine if you lost everything in a fire. It’d be a devastating blow. But at least your insurance would cover most of the damage.
If you had it.
Unfortunately, a majority of people who rent apartments don’t have this protection.
Apartments.com, a Web site that helps renters find apartments across the country, reported that 58 percent of respondents to its recent survey said they did not have renters insurance. At the same time, more than 70 percent of respondents who didn’t have this insurance said that they believed carrying renters insurance would improve their peace of mind.
Why is there such a big discrepancy between having renters insurance and believing it is important? To no one’s surprise, cost seems to be the biggest issue. According to Apartments.com, 40 percent of survey respondents say that they forego renters insurance because it costs too much.
Like I said, no surprise. Apartment rents have gone up across the country. Something has to give. Often, it’s renters insurance.
An additional 24 percent of survey respondents stated that they were unaware that renters insurance exists, while another 18 percent said that the value of their personal possessions did not warrant renters insurance.
This may not seem like a huge issue. We’re usually more concerned with homeowners insurance, so much so that mortgage lenders require homebuyers to purchase a homeowners insurance policy before they can qualify for a mortgage loan. But maybe the same needs to be done for renters. Losing your possessions in a fire or other disaster is heartbreaking. Insurance at least helps take away some of the sting.
It’s easy to forget, as we focus on the current residential real estate market slump, that a huge number of citizens still rents. The Apartments.com survey shows that these renters have issues, too. It’s one thing to be unaware of renters insurance or to consider it not a worthwhile investment. But to not be able to afford it? That’s something the insurance industry can address. Maybe rates are too high. Maybe rents are too high. Maybe it’s both.
Regardless, landlords and the insurance companies need to do everything they can to entice more renters to insure their possessions. Perhaps that requires a drop in the cost of renters insurance.
Tags: Apartments.com, renters-insurance, rentingRelated Stories
POSTED IN: Breaking News, Educational Tools, Real Estate Terms, Real Estate Tools, Rent, Road to Profits
2 opinions for Risky business — apartment owners skip the insurance
Kelly
Nov 12, 2007 at 9:18 am
This is sooo true! About 10 years ago, my good friend lost almost everything in her apartment from water damage when a fire broke out several houses down from them. Of the five houses, many of which had several apartments, my friend was the only one insured. She was able to replace all of her furniture - and more important to her, her shoes!
Dan
Nov 13, 2007 at 6:26 am
Hi, Kelly:
Thanks for your comment. When I rented, I did take out renters insurance. I never needed it — thankfully — but always felt reassured that it was there.
Have an opinion? Leave a comment: