Tuesday, April 7, 2015

With the price of starter homes reaching almost prohibitive prices, it’s no surprise that approximately 8 million people rent properties in urban areas. Whether you’re renting while you save up for a deposit on a house or just ‘in-between’ cities for the moment, renting a home can be easier than buying one.

“Tenants don’t have to pay for the regular maintenance of the property; they don’t have to worry about property rates; and if anything happens to the physical structure of the house or apartment they’re living in, their buildings insurance should cover it,” says Warwick Scott-Rodger, Head of Dialdirect. 

That said, although there are a lot fewer financial responsibilities and obligations on tenants, they should still take precautions to insure their own valuables. According to TGI research, only 5% of rented properties are insured with buildings insurance and only 4% of the tenants have home contents insurance in place.

“What tenants must realise is that the homeowner’s liability ends at the four walls you’re living in. If your property - your clothes, electronics, appliances and the like - is damaged in a fire or stolen, your landlord’s insurance will not cover this. Anything you brought with you into the place when you moved in, is your responsibility to insure,” says Scott-Rodger.

He went on to say that when seeking to insure their possessions, tenants can make this easier for themselves by keeping the following tips in mind:

  • Understand the difference between ‘home contents’ and ‘portable possessions’ insurance. In most cases you will need both.
    • Home contents insurance covers your furniture, clothes and appliances.
    • Portable possessions insurance covers the things you carry with you, e.g.: laptops, cellphones and sunglasses.
  • Using an inventory form is an easy way to help you calculate the full value of all of your home contents. It is important to update your household inventory list on a regular basis to ensure that any new items are included and to remove items that that you no longer have. Should you have a claim down the line, you will avoid the hassle of trying to account for all your items.
  • Make sure to insure your possessions for their replacement value. The replacement value is what it would cost you, at the time of a claim, to replace all your belongings with similar brand new ones.  The replacement values of goods change over time and if the policy is not reviewed and the higher replacement value is not taken into account, cover becomes inadequate.
  • The better the security at the home you are renting, the less you will pay for home contents insurance every month. It’s worth speaking to your landlord about installing burglar bars or an alarm if you don’t have these.
  • Many insurance companies offer benefits along with a home contents insurance policy, such as insuring your guest’s belongings, or even veterinary expenses for your pet. Shop around for the best benefits before settling.

*According to TGI research

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