Tenants: Do you need insurance?

Renters enjoy not needing to worry about insurance for their home, but a lot of renters often forget about the valuable contents they have inside. As a result, there are currently millions of rental households across Australia that are underinsured and vulnerable to theft or property damage.

Consider these 3 elements

1. Surprising statistics

Real estate and property experts estimate that there are 2.5 million rental households in Australia. The size of the figure surprises many, as although renting is often seen as an option that is taken mainly by university students and young singles, expensive housing and the desire to be more mobile has let too many couples and families also choosing to rent instead of buy.

2. Scary statistics

But the statistics don’t stop there, with the rates of insurance penetration for rental households bordering being rather alarming. The need for home insurance is well understood, with over 93% of Australian home owners having home and contents insurance in case of water damage, fire, or any of life’s other small mishaps.

But what would be your estimate of how many renters insure their belongings? 80%? 60%?

In fact, only 26% of rental households have cover for their possessions, which can lead to a major hole in the household finances if anything goes wrong.

3. Reasons to get covered

There are many practical reasons to get rental insurance, but the top ones are covered here.

It’s cheap—for most households, cover for the possessions in a rental home comes in at around $10 a week. That’s a small price to pay for up to $20,000 worth of contents insurance.

It covers your property – this might seem like an obvious point, but all too often, renters adopt the “it’s not my house so why would I insure it” stance. But unless you’re living on a borrowed mattress in a spare room with no other possessions, chances are you have a phone, clothes, furniture, laptop, TV, audio equipment, and everything else that is valuable to you.

Without insurance, could you find the hundreds or thousands of dollars to replace one or more of these things at short notice if you needed to?

Rental insurance can also cover living expenses. In the event that wild weather occurs or your rental home becomes uninhabitable for other reasons (e.g. urgent repairs, painting, pest treatments etc.), rental insurance can help offset the unexpected bill of having to pay for alternative accommodation.

The low cost and high practicality of rental insurance means that it is something that the millions of Australian renters should consider. It only has to save you money once before you will be thankful.

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