New survey shows tenants don’t understand liability issues
'What do you mean my landlord’s not responsible?'
It’s a crucial question for renters — particularly when they go on vacation: Who is responsible in the event of burglary/theft or property damage from a fire, weather or negligence?
Turns out a lot of renters are in the dark about who bears ultimate responsibility.
According to a new survey by global risk solutions provider Assurant of 1,000 U.S. renters, nearly one-third (32%) believe either the landlord or property management company should be responsible for damage or liability protection, while an additional 25% said they were “not sure” who’s responsible.
This misunderstanding among U.S. renters is significant, especially considering that more Americans rent their homes now than at any other point in the past 50 years, and the value of their possessions continues to rise.
Related: 13 renters’ insurance companies ranked highest for customer satisfaction
Education is key
It is incumbent upon agents, brokers and claims experts to spend more time not only educating renters about damage and liability protection but also helping them understand that a renter’s policy is very affordable.
Not surprisingly, of the 45% of respondents from the Assurant survey who said they didn’t have insurance, many cited cost as the reason. To address this issue, insurance professionals should consider:
- Providing specifics on the affordability of a renter’s policy. In other words, how the average annual cost is only $160 a year, which includes $10,000 in coverage for belongings and $100K for liability coverage and replacement costs.
- Discussing how the cost of repairing damage, paying hospital bills or replacing stolen items is often much higher than the cost of protection.
- Positioning a renter’s policy as a competitive advantage. In other words, many landlords and building owners require renters insurance, so having insurance when applying for a new apartment is beneficial.
- Informing renters that insurance may also offer liability coverage if a guest or visitor is injured on the property and litigation ensues.
To post or not to post
Another important area where renters need guidance is on how to mitigate risks while out of town.
Start by offering renters some advice: wait to post vacation photos on social media until after they return. Among the 85% of Americans who post their vacation news on social media, 38% do so while they are away. Frankly, this is concerning because most burglaries and thefts happen while tenants are not home. Bottom line: these posts may be unintentionally sending an open invitation to thieves and other bad actors to break-in to their homes.
Compounding the problem, few renters take precautions to prevent a robbery. Despite 41% of renters experiencing or knowing someone who has experienced a theft, the Assurant survey found that more than one-third (35%) do nothing more than lock the door to prevent it. In fact, one-quarter of respondents said they never lock up their valuables when on vacation while an additional 25% only do so occasionally.
Because renters are choosing the path of least resistance when it comes to protecting their property and possessions, there is an opportunity to educate them about the risks that come with renting an apartment.
As insurance professionals it is in our best interest to work with renters to help them understand the true value of their possessions, the affordability of insurance policies, and the responsibility they may bear if something goes wrong.
Steve Hein is senior vice president of Multifamily Housing at Assurant. To find out more or contact this contributor, send email to David Blumenthal (david.blumenthal@assurant.com).
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