If your television is stolen or your dishes are lost in a kitchen fire, your landlord's insurance won't pay to replace them, but a renters' policy probably will. Too many renters think they don't need liability protection because they rarely have guests or believe that the likelihood of someone being injured in their home is almost non-existent. You will only need to purchase renters' insurance if the landlord or property management company requires it of the tenants. However, tenants who are wary of the risks of a low-probability, high-cost claim should consider purchasing even more coverage.
Despite what many tenants think, their landlord or management company does not insure them or their personal property. Landlords can make tenants' insurance mandatory to limit the risk of tenants suing them for damage to personal property or for liability costs. The limits of a renters insurance policy still apply, but coverage is certainly better than nothing. Anyone living in a college dorm is probably covered by their parents' homeowner's or renter's insurance policy.
The lower a person's income, the more they will need renters insurance, especially liability and loss of use coverages. Home sharing is a good way to earn extra money and, as long as the renter complies with the rules of their policy, renters insurance provides a layer of protection in case something happens to their guests or their belongings. With renters insurance you will have loss of use coverage, which covers living costs that exceed your normal expenses, such as hotel stays, food and special transportation you need to continue living until you return home or find a new permanent residence. In the event that your flat or house is deemed uninhabitable due to a covered event - smoke damage, for example - you would be required to pay out-of-pocket living expenses that exceed your usual spending levels if you did not have renters insurance.
For most tenants, renters' insurance is an invaluable tool to protect them from potentially devastating financial consequences. However, even if a renter has no personal property, the other features of the coverage make renters insurance worthwhile. Beyond the obvious coverages and benefits of renters insurance, there are some lesser-known advantages that may convince renters that it is a valuable purchase.