If you plan on moving out, you must have asked yourself, do I need insurance when renting a house? Yes, you should always look into insurance when renting a house. Although it may seem like a luxury instead of an absolute necessity, it could be the safeguard that keeps you protected in case of theft or fire.
What is renters’ insurance?
If you’re renting a place, you might be thinking that your landlord’s insurance covers any damage to the property. But think again!
While your landlord may have home insurance that protects their property, it doesn’t cover your belongings. So, if something happens to your stuff while you live there, they’re not going to be responsible for it.
Landlord insurance policy probably won’t cover damage caused by things like natural disasters or fires—and even if it does, you might find yourself paying out of pocket for repairs or replacement.
That’s why it’s important to have your own renter’s insurance policy to protect your belongings, no matter what happens at the rental property.
Contents insurance
If you’re renting a place, and you have anything of value in it, then you should consider getting contents insurance. The contents insurance covers the cost of replacing your belongings if they are stolen or damaged due to an accident, fire, or flooding.
If a burglar breaks into your home and steals your laptop, then contents insurance will cover the cost of replacing it (up to the amount that you’ve insured). Portable contents insurance also comes under this category.
This insurance can be taken out by anyone who lives in rented accommodation, including students and young professionals, as well as homeowners.
When do you need renters’ insurance?
Landlords and property managers can require that tenants get renters insurance, but the insurance isn’t required by law. If you rent an apartment complex the body corporate insurance or strata insurance is necessary. Strata insurance covers the physical structure of your apartment complex and the law requires it.
When landlords or property managers want you to get renters insurance, it’s usually because they want to limit the risk of having to pay for any damages that may happen to your property. Therefore, if your lender requires you to have renter’s insurance, you should go for it.
What does renters’ insurance cover?
For renters, disasters come in many shapes and forms. That’s why it’s so important to invest in a renters insurance policy. The right policy can be the difference between losing everything you own and protecting your property.
Here’s what your renter’s insurance covers.
Loss of use
Loss of use is the most comprehensive casualty coverage that comes with a renters insurance policy. If you are unable to live in your home because of a disaster, your renter’s insurance policy will help you make ends meet as you seek temporary housing and repair or rebuild your home. Besides, it can also help you if you default on rent payments.
Personal property liability
The legal liability cover protects you, your family, and your belongings against the costs of injuries, wages, and investment property damage caused by your negligence or someone else’s at your residence.
Personal property damage
If you have an event covered by your renter’s insurance and personal belongings are damaged or destroyed, it will be covered up to the limits of your policy.
Medical protection
This is medical protection for someone hurt on your property. It pays for the insured person’s medical expenses that result from the injury occurring on or off your premises.
Is renters’ insurance worth it even if my landlord doesn’t need it?
Although most people don’t have to own renters’ insurance, it is still a good idea to have this protection in place. Your personal property policy helps protect your home and family from the financial impact of sudden or unexpected events that damage your belongings or leave you legally liable for others’ claims.
Therefore, it’s important to make sure that you have covered your property in the event of an accident or damage. So, you can get your apartment back to normal again quickly and without having to pay out-of-pocket expenses.
Is renters’ insurance expensive?
Renters’ insurance is not expensive. The average home and contents insurance in Australia is $160 to $7400 per year.
It can be affordable insurance to purchase depending on the area you live in and how much insurance you purchase. It also depends upon your rental income.
So, if you are a renter and do not have renters insurance, consider adding it to your policy.
With the help of our renters insurance guide, we hope you can make a more informed decision on your loan. But feel free to check out our finance section for more guides and tips.
