Renters encouraged to purchase insurance

Failing to purchase renters insurance can lead to irreversible consequences and permanent loss.

Elizabeth Henderson learned this lesson the hard way when an unexpected flood damaged her apartment at The Warehouse. She was shocked to discover that the complex was not responsible for the reimbursement of her destroyed wardrobe, closet and carpet.

“We wanted to get paid for all the damage, but we found out that without renters insurance, we were on our own,” Emily Freeman, Henderson’s roommate, said.

According to the Student Legal Services website, tenants should realize that their property’s insurance policy may not cover their personal items.

Landlords may purchase insurance policies to protect the walls, appliances and floors of their property. These policies do not cover items such as tables or televisions owned by the tenants themselves.

If an unforeseen disaster occurs, such as vandalism, fire or theft — and is not the fault of the landlord — an occupant will be responsible for paying for damages to personal property.

Most students do not expect these disasters to strike. However, according to Legal Services attorney Dorothy Bernholz, this expectation is often proven wrong.

“You don’t think these things will happen, but, it’s been my experience that from time to time they do,” she said.

Bernholz recommended purchasing renters insurance, if needed. She warned that, because many students are only temporary residents of Chapel Hill, these students may be covered under family insurance plans. In this case, renters insurance would not be necessary. Similarly, some credit card companies offer renters insurance benefits that counteract the need for a separate personal policy.
Erin James from Chapel Ridge Apartments said that most tenants do not own renters insurance.

“We have our own policy to cover our furniture and our apartments come fully furnished. We just recommend it if they have a nice TV or computer or anything,” she said.

The Mill House Properties real-estate company, which owns popular Chapel Hill apartment complex Chancellor’s Square, recommends renters insurance.

“Our leasing consultant usually suggests to tenants that they purchase insurance as she is going over their lease,” said Mill House Administrative Assistant Evelyn Greene.

Bernholz encouraged potential buyers to make an informed decision. When shopping for insurance, renters should be wary of “special riders,” she said. Some policies will cover general items, but will require an additional fee for expensive or luxury items, such as an antique ring or an expensive phone.

Students should also be aware that not all insurance plans offer full compensation for damaged items. Some policies only offer fair market value compensation, meaning that items will be reimbursed for their current market value rather than for their original cost. In the case of goods with depreciating value, such as computers, this is an important consideration.

Harvey Eveleigh, University Insurance agent, encouraged students to consider purchasing renters insurance from their auto insurance company.

“You get a multi-policy discount, which will decrease the price of your insurance,” he said.

Eveleigh also emphasized the importance of liability coverage in a renters insurance plan.

“The liability portion is very important,” he said. “If you live in an apartment complex with four buildings and you burn down the entire place, you could be sued to pay for the whole building.”

Bernholz adds that liability could also be an issue when students go home for breaks.

“The pipes often freeze, causing damage that the renter could be responsible for,” she said.

To alleviate the stress of all these issues, Eveleigh advised students to find an agent they are comfortable with.

“You want to have a good relationship with your insurance agent,” he said.

While it is often overlooked amidst the constant stress of 8 a.m. classes, empty bank accounts and demanding professors, renters insurance is an important issue that all tenants need to seriously consider.

For students who buy dispensable items to last them through senior year, renters insurance might not be necessary. Those with keepsakes might disagree.

Contact the City Editor at city@dailytarheel.com.