Even as the renting population grows nationwide, a startling number of Americans remain inadequately insured. Given the relatively low cost of the average renters insurance policy and the peace of mind that can be gained from it, it's worth wondering how many individuals are actually aware of their options.
The simple answer, according to a recent study from Nationwide Insurance, is not enough. Millennials, especially, are woefully unaware of the affordable costs at which they can secure protection for their belongings. According to a Property Casualty 360 report, the survey found that just 56 percent of Gen Y-ers are covered by renters insurance, while an overwhelming segment of the same population was uninformed when it came to the range of affordable monthly policy options at their disposal.
Of the 1,000 renters between the ages 23 to 35 who participated in the survey, approximately 40 percent said they didn't view renters insurance as a necessity. That's despite estimating that it would likely cost about $5,000 to replace their personal belongings. Given that millennials represent the most massive age demographic in the country - larger than baby boomers, at 86 million - the conclusion that the majority of American renters are underinsured is a scary one.
"It's clear that there's a misconception among millennials about the importance of renters insurance and how much it really costs," said Matt Jauchius, chief marketing officer for Nationwide. "For the $20 renters spend on items such as coffee and streaming video, they can get excellent coverage to help protect their belongings. Considering renters share many of the same risk as homeowners, it's not only important; it's a no-brainer."
Evaluating personal inventory and its cost
Meanwhile, 24 percent of renters responded that they would save their personal computers above all other possessions. Yet just 40 percent of the same responding population was aware of the fact that renters insurance may cover losses stemming from stolen property, such as a computer. These sort of misconceptions underscore the opportunity presented for insurance agents, who could provide younger, renting Americans with an easy, yet essential education regarding the ins and outs of policy options.
For example, Nationwide suggests that a good starting point may be in advising renters to take inventory of the total cost of their belongings. That may help paint a picture of their potential losses, and therefore encourage people to pursue the purchase of a policy.
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