Allstate survey: Nearly half of U.S. renters lack renter’s insurance

John Egan

The average U.S. renter owns about $30,000 worth of possessions — TVs, stereo systems, clothing and so forth. Yet only 45 percent U.S. renters carry renter’s insurance to protect their belongings, according to a survey by Allstate.

“It’s important for renters to know that their landlord’s insurance most likely will not cover the tenant’s personal belongings. A landlord may have coverage that can help cover the cost of structural damage to the dwelling if the unexpected happens, but renters may be faced with significant replacement costs for their furniture, clothes, electronics and other belongings,” Keith Rutman, vice president of Allstate’s consumer household unit, says in a July 2012 news release.

A poll conducted in 2006 by the Insurance Research Council found that 43 percent of renters had renter’s insurance. Meanwhile, the National Multi Housing Council, a trade group for apartment owners and developers, reported in 2011 that 62 percent of apartment companies required their tenants to carry renter’s insurance.

One-third of Americans live in rented space, including apartments, houses, condos and townhouses.

“It is important that renters carefully evaluate their need for insurance. Replacing personal possessions without coverage can be quite costly,” says Ohio Lt. Gov. Mary Taylor, the state’s insurance director.

The average American renter pays $15 to $30 month for renter’s insurance, Taylor says.

What’s covered?

Rutman points out that renter’s insurance covers losses from such disasters as theft, fire and vandalism. Standard renter’s insurance policies don’t cover damage from floods or earthquakes.

A renter’s insurance policy also can reimburse the costs of living elsewhere if you’re temporarily forced out of your rental unit because of a disaster. Furthermore, renter’s insurance offers liability coverage in case you’re sued over injuries or property damage caused by you, your family members and even your pets.

“While it’s important to have coverage for your personal possessions, what’s even more important is to have protection in case someone sues you,” says Loretta Worters, a spokeswoman for the nonprofit Insurance Information Institute.

“Part of having renter’s insurance includes liability insurance,” she adds. “For example, if you have a party and someone gets injured and sues you, if you don’t have renter’s insurance, you’ll have no protection. Or if you have a pet that injures someone or someone falls on your steps and sues you, it’s important to have that kind of coverage. In today’s litigious society, it’s a very important protection for your assets.”

Renter’s insurance discounts

Insurers often offer discounts on renter’s insurance if you insure your car or business with them as well, according to the Insurance Information Institute. You also can get discounts for such things as:

• Having a security system.

• Using smoke detectors.

• Using deadbolt locks.

• Maintaining good credit.

Fire damage worries renters

Other findings of the Allstate survey include:

• The top concern for renters is fire damage.

• 54 percent of renters say it would take at least three years to replace everything they lost if they didn’t have insurance.

• About one-third of renters have conducted an inventory of their possessions, compared with 44 percent of homeowners.

The Allstate survey of 1,000 American adults was conducted by phone in December 2011. FTI Consulting Inc. did the survey.