A large portion of renters don’t have any method of insurance, much less coverage for natural disasters. Many simply don’t believe that anything so terrible could happen to them or to their rental property. While dwelling upon the worst case scenarios of what could happen is not healthy, it is important to provide for those situations. Protecting a home from natural disaster threats means that its owner is protecting a financial investment in it. Many renters don’t acquire this kind of coverage, though, because they feel that such a disaster is unlikely and coverage is an unnecessary expense. Do renters need this kind of coverage, though? How can it be obtained in the event that they decide to seek it – particularly when many standard renters’ policies don’t provide it?
Why Renters Need Coverage
Many insurance policies offered to renters offer mix-and-match coverage. This is great for those who want to tailor precisely what their insurance will provide for. You can typically choose which natural disasters you can be covered for, as well. If you live in an area that is at higher than normal risk for tornadoes, hurricanes, flooding, or earthquakes, it is a very good idea to specify which you want to have coverage for and how much the policy will pay in those situations. Real estate agents operating in these areas usually suggest coverage to their clients as this kind of practice is included in a number of real estate courses specifically targeting these unique areas.
If your house is the base for your work or a full business and contains valuable work-associated items, chances are that these items are valuable and signify a large investment on your part. Expensive equipment such as computers and peripherals, musical instruments, and merchandise could be destroyed in a natural disaster. Also consider whether you have anything that cannot be replaced. If this is your situation, it is more likely wise to have your home insured for disaster circumstances to make sure that your livelihood does not suffer.
Be Aware of Your Coverage
Policies vary in renter’s insurance just as they do for other varieties of insurance policy. Standard coverage under a renter’s insurance policy often means that ‘acts of God’ are not covered. This means that damage caused by floods, tornadoes, mudslides, and other natural disasters are not typically covered by those policies. Some coverage will provide renters who undergo significant damages with money to pay for basic living expenses, but not much else.
The costs of coverage that will pay out on claims for natural disaster damage vary according to geographical area. For instance, hurricane coverage in Kansas might come quite cheap. If you tried to buy it in New Orleans, however, you will end up having to pay far more if you can obtain it at all. Mudslide coverage might be a very affordable addition in New York, but it could cost a great deal more in Los Angeles. In some areas that are prone to certain weather events, landlords require those renting from them to purchase additional insurance covering natural disasters.
You May Not Need Coverage
Before putting a large chunk of your budget into buying natural disaster coverage on your renter’s insurance, consider your location. The costs are not worth it to all renters. If you live in an area that receives a disproportionate number of tornadoes, then by all means, look for suitable coverage. However, if that area that you live in very rarely receives any kind of severe weather or disaster level events, you probably don’t need to spend money on extra coverage that could be utilized elsewhere. Don’t rely on your news to make this decision – news channels are sensationalist and get viewership by alarming people. Do a bit of research into the natural disasters that have occurred in your geographical area and judge the necessity of coverage by this.
Take the worth of your belongings into account and add up how much natural disaster coverage will cost you each year. If the premium costs are worth it and everything you own comes out to a significantly higher amount, you might want to purchase the additional coverage for your protection. It is important for renters to consider natural disaster coverage, whether you come to the decision that you need it or not. The decision comes down to whether you have more to lose by not having the coverage than by paying for it.