Renters, get ready for an extra cost

October 8, 2009 4:15:40 PM PDT
Apartment dwellers, get ready for a new expense -- renters' insurance. It has been around for years, but many renters who once could choose the coverage or not are having the option taken away.

The insurance is billed as a bargain, and it can be very inexpensive. But now some complexes in Houston are making the policies a requirement for renters.

If you are moving into an apartment or about to renew a lease, you may be asked to pay the extra expense of renters insurance.

"Some owners are requiring renters to have insurance just like a rental car company or a mortgage company would require auto insurance or homeowners insurance," said Andy Teas with the Houston Apartment Association.

The renter insurance requirement is becoming more popular and the policies can be a condition of moving in or staying in an apartment. A renters insurance policy includes both property coverage and liability coverage and they cannot be separated. Legally, the complex managers can make renters take on a policy.

"Just like a mortgage company or rental car company, they are permitted to require that and certainly you do not have to lease at a property that requires that if you choose not to," said Teas.

The costs for the policies can be very reasonable. Renters insurance can be purchased for about $20 a month. But be warned. Your credit score plays a part in how much you will pay for a year-long policy.

"It could have a $300 spread, go from $200 to $500," said Josh Hargrave with Harco Insurance.

For those with bad credit, renters insurance can be close to $50 per month and for some renters, any extra costs can be tough to cover.

"If you are on a fixed income, the economy is bad, people are not working, so $20 is a lot right now," said renter Kimberly Ferguson.

Ferguson is not required to have renters insurance and like all renters, she cannot be forced to get it in the middle of a lease.

"Only when the lease comes up for renewal. They cannot change the rules in the middle of a lease term, but when the lease comes up for renewal, they can implement a policy," said Teas.

You can get renters insurance from just about any company. If you combine it with car insurance, you may get a discount. You can find out more about getting renters insurance on the Texas Department of Insurance web site.

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