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Roommates can be a financial lifeline

Roommates can be a financial lifeline

Renting has become the lifestyle of choice for many young adults. Some people turn to renting to escape the financial hurdles associated to homeownership, others simply prefer sharing space because it’s more cost-efficient and sustainable. No matter the reason, the fact is the number of people living with a roommate/housemate or romantic partner is on the rise in the U.S., according to the Insurance Information Institute (I.I.I.) .

U.S. Census Bureau data shows that one out of every eight homes in the U.S. is now inhabited by two or more people who are not related to each other – an increase of over 5 percent from 2000 to 2010. In order to fully enjoy the benefits of cohabiting, there are some common issues that need to be addressed and clarified before hopping on board.

It is true that renting offers much more flexibility and allows roommates to share everything from monthly expenses on rent and utilities to internet and cable services, and even grocery trips. But it also entails a certain degree of responsibility, particularly when it comes to protecting personal belongings. One way to avoid unnecessary trouble and ensure a happy co-existence is to acquire renters insurance.

“Generally speaking, young people have very fluid living situations that can quickly change as career, educational or romantic opportunities develop,” said Jeanne M. Salvatore, the I.I.I.’s consumer spokesperson and senior vice president of Public Affairs, in a written statement. “So a college grad, for instance, who moves into a house with a bunch of friends, should consider getting his or her own renter’s insurance policy in order to financially protect themselves.”

Standard renters’ insurance policies provide insurance protection for personal belongings such as furniture, clothing, electronic equipment, or jewelry, in case of a wide array of misfortunes including fire, windstorm, lightning, theft, or vandalism.

Rental insurance policies also provide coverage for liability protection and the cost of additional living expenses should you be forced to temporarily move out of your apartment due to a covered loss, such as fire breaking out at your apartment complex.

One of the many perks of sharing living space is that you and your roomie may purchase a renters insurance policy together. As a general rule, your partner and up to three additional adults (over 18 yrs.) can be covered under one policy, according to ResidentShield.com.  Nominal additional premium amounts may apply.

Most people tend to overlook important business such as renter’s insurance because they mistakenly believe their personal property is protected under the landlord’s insurance policy. Well, know that typically that’s not the case. The landlord’s insurance covers only the structure and the common areas of the apartment building not the tenants’ belongings inside. So the only thing standing between you and an unfortunate event robbing you of your dearest possessions is renter’s insurance.