Australians are notoriously underinsured and people living in rental properties are no exception. Shockingly, the Understand Insurance Home and Contents Survey revealed that more than half of renters don’t insure their contents at all and Australians in general seriously underestimate the worth of their contents when they do insure. This means that many renters find themselves in a situation where they have to wear the cost themselves if something happens to their belongings.
For individuals who rent, it’s essential that you have Renters Insurance in place and we’ll be taking a closer look at what this cover offers you.
What is Renters Insurance?
Renters Insurance is a form of personal property cover and will cover you financially if your belongings are lost, damaged or stolen. It can cover you for incidents including theft, water damage, smoke damage and fire.
Why do you need Renters Insurance?
A common misconception amongst renters is that your landlord’s insurance will cover you if anything happens to your possessions. Unfortunately, landlord insurance only covers what the landlord owns which is the house and land – This means that anything that belongs to you at the rental property isn’t covered by their insurance.
The extent of underinsurance amongst renters could also be due to the fact that you don’t think your items would cost much to replace. Think again. If you added up the individual cost of each item, you might be surprised at how expensive it would be to use your own money to pay for replacements. This is particularly the case when you think about more expensive items such as computers, tablets, smart phones and other electronic items.
Remember to look for an insurance policy which offers new for old replacement and ask about coverage limits which is the maximum amount you can claim for on your policy.
How much will it cost?
The cost of your Renters Insurance will depend on the total cost of your belongings and the more expensive your belongings, the higher your premium. However, Renters Insurance is a relatively inexpensive form of cover and well worth it when you consider the cost of replacing your items if something unexpected happens.
Remember, take the time to go through your belongings and estimate how much it would cost to replace everything. People tend to underestimate how much their possessions cost so it’s important not to simply guess. Let your insurer know if you have particularly valuable items, such as jewellery. Also, hold on to receipts for proof of purchase and take photos of your possessions as this will make the process go much more quickly at claim time. Let your insurer know if you purchase any expensive items while you’re renting So you can discuss adding these to your policy.
When it comes to paying your premiums, many insurers will allow monthly or fortnightly payments which means the cost is spread throughout the year. Alternatively, you can choose to pay annually.
Your premiums are a small price to pay for peace of mind while renting. For more information, contact CGU today.