3 Myths About Renters Insurance

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Many people — especially those moving to New York City for the first time — often hold some misconceptions when it comes to renters insurance. Unfortunately, this often prevents them from taking out a policy — only 37 percent of renters in the City have insurance, according to the Insurance Information Institute.

These misconceptions, of course, can lead to grief when something goes wrong. Here are a few of them:

1. It’s expensive. 

A common perception among renters is that since many of their possessions are expensive, it can’t be cheap to insure them.

Gotham says: Renters insurance is less expensive than many people realize: $50,000 worth of property protection costs about $300 a year; but a $20,000 policy is less than $150. Take out a $500 deductible and that’ll save you up to 10 percent.

2. Your rental agreement has got you covered. 

Many renters are under the impression that a lease agreement with a landlord — or their roommate’s rental insurance — protects their property in the event of theft, a water overflow, or some other event.

Gotham says: The landlord does not cover your possessions if the sink or toilet overflows, for example, or your additional living expenses if a “covered peril” such as a fire or water damage forces you into a hotel. But  renters insurance does cover that.

3. If your claim is denied or you are offered less than what you think is fair, you have no recourse. 

What options do you have in a dispute with the insurance company’s decision on a claim?

Gotham says: First, go to your agent or broker who sold you the renters insurance. It helps to have documentation of your property — receipts, credit card statements, digital photos. You also have the right to file a complaint with the New York State Insurance Department. It can take some time, but insurers will always respond to the state.

Contact Gotham for a free quote today.