Do I Need Renter's Insurance?

By Danielle Wirsansky on February 26, 2021

This article is brought to you by GradGuard. We protect college students and their families from the financial risks of college life, like providing a refund for tuition or replacing a stolen backpack when your school may not. When the unexpected happens, GradGuard’s tuition insurance and renters insurance can help you get back on track.

An important question that students renting their first or second apartment need to ask themselves is “Do I need renter’s insurance? “Insurance can sound like a scary, abstract, expensive thing. You might not know where to start or exactly how insurance or even this specific type of insurance might work. How do you know if you really need it or not?

The place to start is to understand what renter’s insurance is. Renter’s insurance is a policy that protects you financially in case of any peril that happens to your home or your belongings.

If your sink is leaky, then obviously your property or facility manager will come and fix it, and the cost will be on them since they own the property. Many student tenants believe that if any of their own belongings are damaged by something, like a leak, in the apartment, that the cost of repair and replacement will be the burden of the property. However, this is not usually true. The landlord is on the hook for their own property but not for yours. They are indemnified, usually, a small clause tucked away in your lease agreement, let off the hook for any damage brought to your own belongings.

So what happens if a pipe bursts when you are not home and floods your apartment, damaging all of your belongings? The room is wet, moldy, and uninhabitable. You have to stay at a hotel for an indeterminate amount of time while the property is being replaced. You need a laptop to do schoolwork, but yours was ruined in the flood. You think that the property manager will reimburse you for the hotel room you have to stay in or for the expensive personal items that you need back in your hands? Without renters insurance, you will most likely be flat out of luck. Your personal items will not be repaired or replaced at the expense of the property manager, only the repair of the leak.

Another situation to consider is if your home is broken into or vandalized. Many college towns have high rates of crimes in student-dominated neighborhoods, particularly during holiday breaks when students are back home visiting family. This is when many burglars strike, stealing personal belongings and vandalizing homes. There is nothing like coming back home after a restful Christmas break with family in your hometown to an apartment that is either 1) empty (at least of anything of value) or 2) wrecked as a burglar searched your home for anything of value. Who will be on the hook for repairing any damage to your apartment or replacing your lost valuables? Not your landlord.

In these kinds of situations, renters insurance is what steps in to protect you. According to Moneywise, there are three different types of categories that renters insurance will protect a policyholder in:

- “Personal property coverage. This covers the replacement or repair of your belongings.

- Personal liability coverage. This offers financial protection if you cause damage or someone is hurt on your property and is facing expensive medical bills.

- Loss-of-use coverage. This covers hotel and additional living expenses if you can’t stay in your home due to damage.”

Nowadays, many landlords require their tenants to get and show proof of renters insurance in order to live on their property, so you may not completely have a say in whether or not you need to get it. You should know what your potential landlord expects in this regard and that you are okay with it before signing any contracts. If you are adamantly against getting renters insurance, you do not want to sign a lease for a property requiring it. But even if your property manager does not strictly require you to get renters insurance, then it is still usually a good idea to get it. Sometimes property managers require tenants to get renters insurance to make sure their tenants are not put into difficult situations and to avoid any bad blood between the landlord and the tenant should an emergency situation arise. This is because it always in the best interest of the tenant, the student renter, to have renters insurance (not the property’s).

Photo by Sora Shimazaki from Pexels

Renters insurance is meant to protect the tenant from the crazy and unexpected when it does happen. And these things do happen, and there is very little way to predict them. If you think these kinds of occurrences are unlikely to happen to you, that you do not have anything that expensive that could not be replaced, that you can afford the expense of anything that life might throw at you, then perhaps you might not want renters insurance. But if you would rather be safe than sorry, then renters insurance might be the right choice for you.

It’s no secret that college costs a lot of money. Make sure your investment in higher education is protected with GradGuard. Our affordable tuition insurance and renters insurance plans are specifically designed for college students. Customizable plans make it easy to protect your tuition, room and board, laptop, bike, and so much more.

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