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Renters insurance myths and tips

Think renting means you don’t need insurance, or think your landlord’s insurance will have you covered? Think again. It makes no difference if you live in your own place or rent - without contents insurance you could be leaving yourself open to serious financial stress. Take a look at these two commonly-held myths about insurance when renting:

Myth 1: Your landlord’s insurance will cover your belongings 

Your landlord should have insurance to cover their investment property. However, this is designed to cover their investment and not your belongings. 

The same goes if your landlord has supplied whitegoods for you to use. If you have appliances included in your lease–such as a fridge or washing machine – these will be covered under the landlord insurance policy. However this most likely won’t extend to any loss you experience if they’re damaged or break down. That means if a fridge and freezer supplied by your landlord breaks down and it’s filled with food, your landlord’s insurance won’t cover you for the spoiled food. 

Myth 2: You don’t own enough stuff to make having insurance worthwhile 

A common misconception for renters is they don’t have enough belongings to warrant taking out insurance. However, it doesn’t take much for the total to add up. Start by taking into account any electronics – think laptop, stereo and TV – then add in clothes, your bed, any other furniture and white goods such as a fridge or washing machine and you could be surprised by the total. 

So what can you do? Take a look at these top tips to help you get the right level of cover. 

Tip 1: Make sure you’ve estimated the value of your possessions correctly 

Make sure you take the guess work out of what your possessions are work and do a property inventory. Go from room to room and list all your possessions, then put a figure next to each of them with what the replacement value would be. 

Tip 2: When selecting a policy, make sure you know what is (and isn’t) covered 

Before choosing a policy, it’s important you know exactly what is and isn’t covered. Insurance policies provide cover for a range of predefined events, such as damage caused by flooding or fire or for theft. Make sure you read the Product Disclosure Statement (PDS) thoroughly to ensure you’ve got the right cover – it’s important you know what coverage you need before you need to use it. 

Tip 3: Check if you need to insure individual items 

Policies generally have limits on certain items, such as jewellery and artworks. Check the PDS to see if you need to up the coverage amount on individual items. 

It’s also generally a requirement that you list any collections – even a DVD collection. If you’re in any doubt about whether your belongings could considered a collection, get in touch with the insurer before you take out any cover. 

Tip 4: If you make any big purchases, see if you need to up your insurance 

Taking out an insurance policy isn’t a case of ‘set and forget’. Let’s say you buy a new laptop during the year – take the time to check you’ve still got the right level of coverage.