Going Bare: Millions of Renters Lack Insurance Coverage, Survey Shows

Almost 25 million U.S. families renting their homes are going bare on insurance coverage, leaving themselves vulnerable to serious property and liability losses. Many renters without coverage own valuable, high-tech equipment and face higher risk related to pets, a new national survey conducted by Trusted Choice® finds.

The new survey uncovers a persistent lack of awareness or understanding about property and liability risks faced by renters, says Trusted Choice® spokesperson Madelyn Flannagan. Two-thirds (67 percent) of U.S. families that rent lack coverage.

Some 35 million homes were rented in 2005, or about 31 percent of all American households, according to the National Multi Housing Council (www.nmhc.org). Renters insurance replaces furnishings and property in an apartment, condominium or other rental home should those items be stolen, destroyed or damaged. The policy also includes liability coverage, a safety net against a lawsuit or claim that potentially could result in a large financial hit on renters.

Among those respondents who said they don’t have renters’ insurance, 26 percent feel that the coverage is too expensive and another 17 percent said they didn’t know they needed it. Moreover, another 8 percent have never heard of renters’ insurance.

"Insurance protection isn’t a ‘nice-to-have’ for renters," Flannagan said. "It’s an essential backup for property losses - such as water and fire damage - as well as today’s liability risks faced by Americans: slips and falls, accidents at parties, pet attacks, and lawsuits by landlords, for example."

Coverage for renters is widely available and affordable in most parts of the country, with the average annual premium about $20 per month for about $20,000 of property coverage and $500,000 of liability coverage, Flannagan said.

Renters sometimes mistakenly believe they’re covered under their landlord’s insurance policy following a loss or claim, Flannagan noted. "You’re really on your own. Landlords are interested only in insuring the buildings and the infrastructure for those buildings, such as elevators and heating/cooling systems. They’re not covering the contents or liability of individual tenants."
Moreover, the actions by another tenant - such as negligence causing fires and water damage, for instance - have obvious implications for the property and safety of other tenants in a building, Flannagan said.

From Insurance News Net (www.insurancenewsnet.com)