Renters Insurance

Renters insurance, often known as contents-only insurance, provides protection from certain property management-related occurrences including theft of your items or unanticipated damage to them (e.g. furnishings, clothing, jewellery and home electronics).

This particular sort of insurance is intended for renters, who make up a significant portion of the Australian population. Nearly a third (32%) of Australian households rented their residence in 2017–18, according to the Australian Bureau of Statistics (ABS).

Without coverage, you'll be responsible for paying the price of replacing or repairing your possessions if something unfortunate happens to them.

You don't have to arrange home insurance (also known as building insurance) when you rent a place to live because the landlord takes care of that. However, you are responsible for anything inside the four walls that belongs to you but not the landlord.

Would you like to speak to a specialist? Book a complimentary discovery session by calling: (03)999 81940 or emailing team@klearpicture.com.au.

What makes renters insurance crucial?

If you do not have renters insurance, the expense of replacing your things in the event that your home sustains damage could exceed the amount of rent you receive in a single year. According to the Australian Bureau of Statistics (ABS), the average value of the contents in Australian homes in 2017–18 was $69,400. This may seem like an absurdly high amount.

In that case, when was the most recent time you took stock of all you own?

It is very easy to underestimate the number of possessions that you have, which can lead to underinsurance of those possessions. However, do you have the financial resources to meet the expenditures of an emergency such as a fire, flood, storm, or any type of catastrophe?

According to Emergency Management Victoria, one in two Victorians did not have sufficient insurance to cover the expense of replacing their home or other household possessions in the event that one of these disasters occurred.

When shopping for renters insurance, you need to check that the coverage level is adequate to pay for the total cost of replacing all of your personal property.

What is the process for renters insurance?

Renter's insurance works by having you pay a fee to an insurance company in exchange for the protection of your belongings in a number of different scenarios that are specified in your policy. The coverage is different depending on the insurance and the provider.

If one of the occurrences that are covered by your insurance policy causes the loss, destruction, or theft of your belongings, you are required to make a claim with your insurer. If your claim is found to be valid, you will almost certainly be required to pay an additional charge in order to have it processed. It is possible that you may need to provide receipts or photographs of the damaged or stolen goods as part of your claim in order to demonstrate both the worth of the items and your ownership of them.

Does renter's insurance cover replacement costs or cash payments?

If you file a claim on your renters insurance for an item that has been damaged, destroyed, or lost, your insurer will typically replace the item with an identical item or a model that is comparable to the lost, damaged, or stolen item.

However, if your insurance company is unable to locate a suitable substitute for your belongings, they may decide to pay your claim in one of the following ways:

repairing the items through their repairers

• compensating you for the price of the items' replacement or repair
• providing payment in cash
• presenting a gift card to you.

Check your PDS to see if your goods will be replaced with new things; it's crucial that your contents insurance includes a new-for-old replacement benefit.

What situations is renter's insurance designed to cover?

Your contents may be covered by typical renters insurance policies from:

• burn scars
• damage caused by rain and storms
• lightning injury
• explosion, earthquake, impact, theft, or attempted theft damage
• intentional harm or vandalism
• loss of liquid (e.g. damage from a burst water pipe; policies may not cover the replacement of the water pipe itself)
• loss while transportation (if moving house)
• unintentional damage to bathroom fixtures, glass, and ceramic.

Higher-level renters insurance coverage typically covers a wider variety of situations than standard policies, which typically do not cover any of them. This could include protection against the food going bad or shelter for things that are left outside (like bicycles on the lawn, for example) (i.e. if your fridge stops working and your food goes off).

You might also be able to add optional extras for your goods to some renters insurance policies (generally at an additional cost), like:

• engine burnout cover, flood cover (when a fuse blows and damaged home equipment or items stop working)
• cover for personal effects (for items you regularly take outside the home).

What items are protected by renter's insurance?

Your valuables are covered by renters insurance coverage if they are stolen, damaged, or destroyed by specific incidents. Numerous items can be covered by renters insurance, including:

• whitegoods (washer, dryer)
• technology (laptops, tablets, cameras)
• designer clothes
• furniture
• collectables
• Jewelery, the value of your possessions may place a cap on the amount you can claim for particular goods (such as up to $2,500 for a hand-woven carpet or rug) or may impose restrictions for exceptionally pricey items.

You may be able to add coverage for certain goods (such as a diamond wedding ring) up to a predetermined value (for example, $15,000), but doing so will cost you an additional price.

In most cases, the only time you are protected against these things is if they are on your land (e.g. if you lose your wedding ring around the home). However, if you acquire insurance for your personal effects, you will be able to cover these items even if you take them outside of the house (i.e. if you lose your ring while going for a run).

The addition of this form of insurance, however, will most likely result in an increase in the amount that you have to pay on a monthly basis.

What happens if I rent a room in a shared house and have renters insurance?

If you are renting a room in a common property and want renters insurance, you will not be able to choose the level of coverage for the possessions in a particular room. On the other hand, you and your roommates might be able to split the cost of purchasing an insurance policy that covers your belongings and acquire coverage equal to the total value of all of your items.

When acquiring renters insurance coverage for a shared dwelling, it is important to be aware that some exclusions may apply. For instance, some insurers may place limits on the number of people who can be listed as roommates on a policy. Roommates include people who share a living space. If you live with multiple people in a large house, check with your insurance provider to see if they will cover all of you using the same policy.

In addition, if any of your belongings are stolen or damaged by your roommates, you may not be covered by your insurance policy. Please refer to your policy's disclosure statement in order to obtain specifics on your coverage (PDS).

What is the price of renters insurance?

It is difficult to provide an accurate estimate of specific costs because those costs will vary greatly depending on the conditions. When you submit an application for contents-only coverage, the cost of your renters insurance could shift in response to a number of different factors, including the following examples:

• the amount for which you have insurance
• If your property is utilised for business
• the estimated worth of your items
• the history of claims, thefts
• burglaries at the address
• your suburb's crime rate
• the median rent price
  your home's age and structure
• your level of home security
• the likelihood that your home will flood
• whether you want to insure anything you bring outside the house (personal effects insurance).

Consequently, how can you pick a renters insurance plan?

To determine how much insurance coverage you need, you should first determine the value of your belongings by utilising a calculator that is available online. Just make sure that your insurance provides adequate coverage for the costs associated with replacing all of your belongings before you buy it.

The next step is to select the scenarios for which your renters insurance should give coverage. If you rent an apartment and live in an area that is prone to flooding, for example, you should check that your renters insurance covers flood damage.

After deciding which aspects of a plan are most important to you, you can use our contents insurance comparison service to get better rates in a matter of minutes. Utilizing our time-saving comparison tool, you won't have to waste time visiting a bunch of different websites in order to find out how different renters insurance packages compare in terms of price and coverage.

Any accidental damage that occurs to the rental property is the responsibility of the renter. This includes situations in which the dog rips up the carpet or an irresponsible child punches a hole in the wall. Any damage that may have been caused by the tenant or the tenant's guests must be repaired at the tenant's expense.

Because it is the homeowner's duty to ensure that their dwelling is fit for human occupancy, they are the ones who are accountable for making repairs to signs of wear and tear that appear over time, such as cracks in the walls or other types of deterioration.

If you are the one who accidently destroys the rental property, it is reasonable to expect you to take responsibility for organising and paying for repairs yourself.

What other obligations do tenants have?

As a renter, you are responsible for the maintenance and upkeep of the entire rental property, including its contents and any personal belongings you bring along with you.

This indicates that you will need contents insurance, often known as renters insurance at times, to protect your valuable belongings in the event of a loss. These might include the following:

• all of the pieces of furniture, including the sofa, armchairs, wardrobe, and bed
• high-fidelity audio and video gear, including televisions, home theatres, and stereo systems
• equipment for physical activity, such as a treadmill or a home gym
• remnant relics of bygone gaming eras, such as pool tables, table tennis tables, and foosball tables
• guitars, drum kits, or keyboards are examples of musical instruments
• your cherished collection of sports memorabilia (including framed posters)
• artworks
• jewellery
• your precious artefacts and antiques.

Purchasing personal possessions insurance, which is typically an add-on that is offered as part of renters insurance, is your best bet for safeguarding your personal belongings, such as your handbag, camera, or bicycle, from loss or damage. Personal effects insurance is often an optional addition.

As a result of the high cost of housing in the current market, a bigger number of Australians than ever before live in leased homes and relocate frequently, bringing their things with them each time. This trend is expected to continue for the foreseeable future. During the fiscal year 2017–18 in Australia, there was a total of 32 percent of households that were classed as renters.

It makes perfect sense to add an additional layer of protection to your valuables by selecting a contents insurance policy to defend your way of life in this day and age, when so many people now rent their houses rather than buying them. In this day and age, it is more common for people to rent their homes than to buy them.

Renters insurance, which is also commonly referred to as contents insurance for renters, is an option that anyone who is concerned in protecting their own personal things ought to take into consideration. Your standard contents insurance policy will provide you with varying degrees of financial security against a variety of potential problems, including the following:

Fire damage. It would be a horrible tragedy if your assets were lost or damaged in a house fire caused by an accident or an intentional act of arson, but you may take measures to reduce the likelihood that this will occur by observing some safety practises. An insurance coverage will, in the vast majority of instances, also cover damage caused by a fire.

• Theft. This protects you against theft and damage resulting from a break-in or attempted break-in.
• Storm damage. Common instances of how a storm could harm or even destroy your belongings and assets include lightning, hail, and strong winds.
• Legal liability. Renters insurance offers legal liability for the tenants in the event that an incident takes place at the rental property while you are a tenant and results in a court case.

A closer look at contents insurance for renters

A list of typical generic inclusions was provided above (i.e. what is typically found on a policy). Other rental insurance plans, however, might provide larger levels of coverage, such as:

• Explosions. Covering for explosions should absolutely be something to think about if your rental property has gas or if you bring a gas barbeque with you.
• Water damage. Significant contents damage can result from anything as simple as a leaking washing machine or dishwasher, a bathtub, sink, or toilet that overflows. It might also result from storms and runoff from really heavy rain.
• Vandalism. Vandals may harm your possessions in addition to your home's façade, which they will probably target. Outdoor furniture, gardening tools, bicycles, and other items fall within this category.
• Natural disasters. Numerous residential areas are susceptible to floods and bushfires, and some beachfront suburbs are at risk of erosion. The majority of policies will cover earthquakes and tsunamis, although flood insurance may be more expensive.
• Moving house. Your furniture and belongings may be covered by renters' insurance while they are being transported, however additional terms and conditions might be involved.

Contents insurance extras and add-ons for renters

You can also get extra protection through renters insurance to cover loss, theft, or damage to:

• Accidental damage.  Accidental damage to glass and ceramic fixtures, such as sinks and glass cooktops, may be covered by renters insurance.
• Jewellery. Most of the time, our most prized possessions are family heirlooms. It's worth having insurance for anything pricey that would be challenging to replace.
• Clothing and accessories.  If the house burned down, estimate the cost of replacing your whole wardrobe. It may be pricey, even if you don't "dress to the nines" every day.
• Furniture. Even though you might not have much furniture as a renter, your bed, wardrobe, and any expensive goods might still be worth insuring.
• Electronics (e.g. laptops, televisions). Electronics are prone to breakage during a crisis, make a prime target for thieves, and are terribly missed when lost. Even though you can watch Netflix on your phone, if your TV is stolen or damaged, you'll likely miss it, therefore it's important to insure those kinds of products if you can!
• Appliances (i.e. white goods).  If you depend on your refrigerator, dishwasher, washing machine, and dryer, you might want to verify if white goods and motor burnout coverage is included in your policy or is an optional add-on.
• Your music/movie collection. If you collect music or movies, you're probably aware that shrewd thieves are going for rare releases. Even though all you have are ten-year-old Seinfeld DVDs, it could be worthwhile to make sure you have backups available.
• Artworks. Artworks, such as framed photos, prints, and paintings, can be quite valuable financially as well as emotionally. The cost of coverage for artworks may vary based on the item's worth.

Additionally, keep in mind that any objects removed from the house must be covered by personal effects insurance.

Renter's insurance also protects you from financial responsibility in the event that a guest trips and is hurt while they are visiting you.

To see exactly what is listed, read the Product Disclosure Statement (PDS) of the policy, as coverage can vary between insurance companies.

Renters who are wise should make an effort to protect all of their possessions with the appropriate insurance policy. In order to do that, they must compare auto insurance for their car and our renters insurance for their personal property.

Would you like to speak to a specialist? Book a complimentary discovery session by calling: (03)999 81940 or emailing team@klearpicture.com.au.

Why compare renters insurance?

Comparing policies can help you discover a better deal and make it much simpler to obtain the coverage you need if you're renting and need insurance to protect your valuables.

We streamline the process of comparing policies.

You may contrast policies from several of Australia's top insurers with our free renters insurance comparison tool. Why not check out what we have to offer when you can compare and choose a cover in just a few minutes?