Question

1. List some reasons why someone would choose not to have renter’s insurance.

2. How could a catastrophic event impact your finances if you don’t own renter’s insurance?

Answer 1

Renter's Insurance

It is a policy to protect the Tenant in case of theft, fire, and other unforeseen situations.

Some of the reasons why some people don't want to apply for the renter's insurance

• Too expensive

People think that they are already paying the rent and other utilities, then on top of that, they also need to get the insurance. They consider it to be expensive.

• Belongings/stuff not worth insuring

If people feel that their stuff is not worth insuring and that there is no value in their things then they choose to not opt for the renter's insurance.

• Process of applying is long

There is this thought applying for the policy takes time. Thus they do not want to consider it.

• No need in future

What if nothing happens in the future and even then you have chosen the policy. Then it is a waste of our money and efforts.

• Difficulty in claiming

There are many companies out there who make it difficult for the tenants to claim their insurance when they file for it in case something happens. Sometimes it takes too long or they don't even give it. So before getting the policy deep research is required. Not having trust in these companies often leads to the individual not opting for the renter's insurance.

Impact of not choosing the renter's insurance

For example,

if you have not chosen the renter's insurance.

The fire takes place and your things are burned down. Before you might have thought that the value of your things is not too much. But adding up every cost, you will be surprised to think how much it comes up to. The things that you have brought day by day now have to purchase in one day.  

The building is now getting repaired but you have nowhere to go, even staying at the hotel for some hours or days is not feasible for you. Or you have the finance to stay at a hotel but it is quite expensive.

You thought your roommate's insurance could save you but it only covers their damage and not yours. Now you have to empty your funds to get what you need after all your losses.

The insurance could have replaced your damaged goods, for example, your laptop but now that you don't have it you can only go to repair it at its full value.

You have been injured in the case of mishappening or due to your negligence this accident happened, the landlord or other guests can sue you to pay up for their damage. The policy could have covered up all that but you don't have it. Now you have to yourself pay up for the hospital charges or the court penality.