April 2008 Newsletter
An Argument For Renter's Insurance
Wes and Diane Peters lost everything when their apartment burned down this past October.
Though they'd rented for five years, it never occurred to them that they lacked the basics for resting easily at night:
Renter's Insurance.
These are intelligent people, yet they suffer from a bad case of denial. They never considered that 500,000 acres would burn, 1,500 homes would be destroyed, and nine people would die from a fire. It always happens to someone else, they figured. On October 22, 2007, it was the Peters family's turn to be "someone else."
It's sobering to realize how many apartment dwellers have no insurance, no fire extinguisher, and no emergency plans.
And fire isn't the only risk for renters. The US Dept. of Justice reports almost 20% of all rented households were burglarized in 2005-40% more property crime than for homeowners. Renters also generally have twice as much vehicle theft as owners.
Which suggests good reasons for owners to encourage residents have renter's insurance. Consider this: Liability Consultants (Sudbury, MA) found that rental property owners are about the most exposed business in the world to lawsuits. Such suits are often based on the whims, scams, criminality and stupidity of tenants and guests.
Yet educating tenants about renter's insurance increases their ability to be financially self-reliant. Whether their loss is partial or complete, they fall back on their insurance instead of seeking remuneration from the owner or his insurance company.
Even if they never use it, knowing they have it in place will help you both feel better. And because the tenant buys a policy to suit his needs and budget, it provides an armslength relationship for the owner regarding tenant finances.
It's even worth considering providing courses (online or in-person) for fire safety, as well as providing each apartment with a fire extinguisher, if you're not presently doing so.
These actions should:
1) Potentially lower your insurance rates
2) Mitigate property damage
3) Encourage residents to better care for property
Property owners can't force residents to have renter's insurance, though you can suggest it. Renter's insurance will neither solve nor prevent disaster, but having a policy helps residents from being totally reliant on the kindness of strangers for basics like clothing and shelter when problems arise.
While Sunrise Management does not sell insurance, nor do we endorse a particular carrier, we do recognize the importance of educating residents to the value of this investment and urge owners to make this low-cost to help themselves.
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