By Lucinda Warnke
When Claire Grant, a University of Georgia senior studying social work, was signing her first lease, she had never heard of renters insurance. That is, until her apartment complex informed her purchasing renters insurance was required to live there.
“In all the discussions I’ve had about renting apartments, finding apartments, leasing apartments with friends and other people that I know, renters insurance doesn’t really come up,” Grant said.
Despite not being regularly discussed among college students, renters insurance can be useful to people like Grant, who are often signing their first lease and are just adapting to living on their own.
James Carson, professor of insurance and risk management at UGA’s Terry College of Business, said renters insurance is a type of insurance designed for people living in properties they don’t own. Its coverage focuses on renters’ personal belongings inside of a property, as well as providing protection against liability for damage or injury in a rental. It can be especially useful to people living in older properties, which may be more prone to accidents and damage.
For example, if a renter’s apartment were to catch fire and they lost personal belongings as a result, renters insurance could cover the cost of the items lost.
Compared to other forms of insurance, renters insurance is also very affordable, Carson said, with prices usually ranging from $10 to $20 a month. Grant said she is currently paying $11 a month for her policy.
“Even if the renters insurance didn’t ultimately provide coverage for the type of loss that might occur, it’s not like the person would be out a whole lot,” Carson said.
Carson also said purchasing renters insurance isn’t likely to be difficult as just the act of being interested can send a positive message to potential insurers.
“The type of person that’s likely to buy renters insurance might actually be exactly the kind of person that the insurer would want in that they’re already thinking about, ‘Oh, you know, there’s a risk, I have an exposure here, potential liability,’” Carson said. “That very personality is the kind of personality trait that is often associated with lower probability of loss in the first place.”
As for landlords like Grant’s who require renters insurance as part of the conditions of the lease, Carson said renters who are insured benefit landlords because it reduces the potential for a lawsuit. If a tenant has their personal belongings stolen from or destroyed in a rental property, they are more likely to go to their insurer to cash their losses rather than suing their landlord.
For people buying renters insurance for the first time, Carson said it’s important to research and look at all the options. He advised they look at an insurer’s rating, which shows the financial strength of an insurer and can tell consumers whether or not the insurer will be able to pay in the event of a loss.
“As with most purchases, it pays to shop around,” Carson said. “Don’t just buy the first renters policy that you get information on.”
Lucinda Warnke is a journalism student at the University of Georgia.