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Renters across U.S. are underinsured

Renters across US are underinsured

Despite the relative affordability and range of coverage, many renters across the U.S. do not have renters insurance. 

According to a recent survey by Princeton Research Associates International on behalf of, 36 percent of Americans rent their homes.

However, the number of renters who purchase insurance for their belongings is low across the U.S. -- with a national average of 37 percent -- and fluctuates across regions.

  • Northeast: 26 percent have renters insurance.
  • Midwest: 41 percent have renters insurance.
  • South: 42 percent have renters insurance.
  • West: 33 percent of renters insurance.

Why renters skip insurance

Renters who forgo insurance are vulnerable to property theft and destruction, but they're also lacking coverage in the event of a lawsuit since renters insurance includes liability coverage.

"Renters should think of their insurance needs in this way: Conjure up an image of your rented residence, and then imagine turning it upside down. Everything that falls out needs to be insured by you under a renters insurance policy," says Michael Barry, spokesman for Insurance Information Institute. 

Here are the top three reasons renters without insurance give for skipping coverage:

In the Northeast:

  • Home has good security: 66 percent.
  • Don't have enough property to need insurance: 49 percent.
  • Insurance is too expensive: 43 percent.

In the Midwest:

  • Home has good security: 60 percent.
  • Don't have enough property to need insurance: 48 percent.
  • Insurance is too expensive: 43 percent.

In the South:

  • Home has good security: 59 percent.
  • Insurance is too expensive, and the landlord has insurance (tied): 40 percent.
  • Don't have enough property to need insurance: 37 percent.

In the West:

  • Insurance is too expensive: 54 percent.
  • Home has good security: 53 percent.
  • The landlord has insurance: 51 percent.

About a quarter of respondents across the U.S. said they don't understand renters insurance, and about 20 percent reported that they don't know where to get this type of coverage. However, you can compare insurance quotes at websites such as to find policies that fit your needs.

Why you should have insurance

"Good security" is not a good reason for skipping renters insurance. Renters insurance protects against much more than just stolen property.

A major component of renters insurance is liability coverage. You can be sued and found negligent if a visitor is injured at your home, and the liability coverage in renters insurance would pay your legal fees. This coverage also extends to some incidents outside your home, such as your dog biting a visitor.

Renters insurance also helps you replace damaged or destroyed property and pay for temporary housing after an event such as a fire or natural disaster. While you may not think you own much stuff, when you need to replace everything immediately and at the same time, while also paying for a new place to stay, the sudden financial burden can be overwhelming.

Though at least 40 percent of renters in every region cite the fact that the landlord has insurance as an influencing factor for not purchasing renters insurance, your landlord's insurance won't always cover your needs. The landlord's insurance protects his property and covers him from liability in cases of property neglect -- for instance, allowing a water heater to rust and burst.

The landlord's insurance does not protect any of your belongings or cover you for liability in cases where you are at fault. This is particularly important to remember if your lease says you are responsible for property management.

For all this protection, renters insurance comes at a relatively low cost. However, renters across the U.S. without insurance believe it costs at least $250 annually and could run to more than $1,000 a year.

"Renters insurance is very cost-effective," says Barry. "Your personal possessions will cost tens of thousands of dollars to replace in the event of a total loss, yet the annual premium for a renters insurance policy is usually no more than $200."

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