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A common misconception is that if you rent instead of own in New York City, you're less responsible for major damages, needed repairs, and accidents. That's only partially true. Yes, if the plumbing needs to be repaired or replaced due to regular wear and tear or age, that's the landlord's responsibility. But if an old pipe broke and water leaks into your apartment and destroys your things, that might not be. Repairs and damages are only the responsibility of the landlord if she is found to be negligent in some way. And that's very hard to prove.
"An old pipe breaking would not be the renter's fault, but typically the landlord would not be deemed negligent either, unless there was a prior indication of trouble," says Jeffrey Schneider of Gotham Brokerage, an insurance firm in New York City (and a Brick Underground sponsor). "NYC is full of old interior pipes ready to go, and there really is no way to address the issue prior to an incident."
But renter's insurance would likely cover that damage.
On average, renter's insurance costs $14-$16 per month, depending on how big your apartment is and the value of your possessions. So says Rey Polanco, a State Farm agent in the Hudson Heights office. Most plans carry a deductible.
So what's covered?
"Renter's insurance covers personal belongings in your apartment against the 'five perils,'" Polanco says. They are: fire, theft/vandalism, water damage, liability (your personal liability to others), and loss of use (if your apartment is uninhabitable, your renter's policy will put you up in a hotel if you’re displaced).
Here are four good reasons why you should consider purchasing renter's insurance.
It's not just about you
In apartment living, you have to consider your downstairs neighbors.
"The most common NYC issue is water damage. [If] your sink or tub overflows," Schneider says, "next thing you know, your downstairs neighbor's art collection or... carpet is ruined, and you are on the hook for the damage."
Yes, you're liable. And if something happens in your building that has nothing to do with you, it could still affect you.
"When you live in an apartment building, you don't have control over your neighbors actions or inactions," Polanco says. "Outside the apartment, [if] there's a fire, renters insurance covers you."
Liability extends beyond the walls and floors of your apartment
"Renter's insurance covers you even when you're not at home," Schneider says. If you hit someone while riding your bike or hit someone with an umbrella accidentally, you're covered.
Another example: if a friend is drinking and drives home and hits someone, you could be personally liable because the drinking took place at your place, Polanco says.
"We have a saying: 'we cover stupidity,'" Polanco says.
Your personal property is covered even when you take it outside of the apartment, too. If you're traveling and lose your luggage, for example, that could be covered too.
Someone could break into your apartment through the fire escape and "liberate your clothing," Schneider says. However unlikely, you probably know a couple of people who this has happened to. Especially if you have anything worth any value, insurance is comforting to have for just these occurrences.
"It will give you peace of mind," Polanco says.
You need to plan for the unexpected
As already noted, unexpected things happen that you have no control over.
For example, "Your next-door neighbor falls asleep smoking in bed or with a candle lit," Schneider says. "When the smoke clears, your apartment is not habitable and you need to stay in a hotel or rent a temporary place for a month."
That falls under loss of use and your renter's policy should cover temporary expenses.
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