When it comes to insuring important assets like vehicles and houses, most people would likely agree that paying for protection is extremely important, especially if the premiums are affordable. However, when it comes to protecting one’s belongings as a renter, many tenants do not seem to feel the same: according to the New York Insurance Association (NYIA), the percentage of renters purchasing apartment insurance has been falling nationally, in spite of increasingly reasonable premiums.
In a 2014 Insurance Information Institute poll, ORC International found that only 37% of renters across the United States reported having renters insurance, compared to 43% in 2006. During this same period, the National Association of Insurance Commissioners (NATC) stated that renters insurance, which is designed to protect tenants from theft, fire, smoke, lightning and more, decreased from $220 a year in 2006 to $210 per year in 2011. This means that for less than $20 a month, most New York renters could ensure that their belongings were protected from a number of potential dangers that could otherwise leave them destitute.
In an article in the Insurance Journal, the NYIA listed a number of benefits associated with obtaining renters insurance: while it is first designed to protect personal belongings, especially expensive items like computers and furniture, it also protects tenants from liability by covering the costs of injuries to the renter, family members and pets. Renters insurance also pays a defendant’s legal fees if they are taken to court. It can also be used to cover additional living expenses if the policyholder is unable to live at their apartment due to damage, including hotel stays, temporary rentals, meals and other expenses.
In spite of these benefits, many tenants and landlords may feel that renters insurance is unnecessary due to the increasing popularity of luxury apartments around the country, which often offer increased security and other benefits.
The NYIA also suggests that tenants consider other policies, which include coverage for natural disasters and problems that standards renters insurance policies do not cover. This includes flood insurance, umbrella liability policies and earthquake insurance, all of which are likely appealing to New Yorkers and other East Coast residents, following Superstorm Sandy in 2012. However, if tenants will follow this recommendation, or if renters insurance premiums will continue to fall, remains to be seen.