With Renters on the Rise, Americans Face Increasing Risk for Property Loss
With foreclosures rising and more homeowners becoming renters, Allstate survey points to need for better personal property protection, home inventory check lists and education
As the number of Americans renting homes increases with the current housing foreclosure crisis, a new survey released today by Allstate finds most renters are inadequately prepared to protect their belongings.
While homeowners coverage is required as a part of most mortgages, renters face no such insurance requirement. As a result, just 40 percent of survey respondents said they have renters insurance, meaning that over 50 million of the approximately 87 million Americans living in rental housing do not have insurance to cover their belongings in case of loss.
The share of rental households jumped by about 1 million in 2007 and this group is likely to expand further if foreclosure trends continue, according to Harvard University's Joint Center for Housing Studies. Now more than ever, it is critical for renters to be prepared to protect their possessions in case of a loss.
Allstate's survey also found more than two-thirds of renters say they have not done a home inventory check list, or tried to estimate the cost of replacing everything in their home in the past year or two. Fewer than one in five renters say they have taken photographs or videotaped their possessions during the past two years to help document what they own.
The survey found most renters underestimate the threat theft poses to their belongings. Nearly half (49 percent) of renters surveyed estimated the number of annual burglaries and other property crimes in the U.S. at less than 100,000, while the actual number of burglaries alone is 20 times that. According to the FBI's most recent Uniform Crime Report, there were more than 2 million burglaries in the U.S. in 2006. Only one in 20 renters guessed the number was in this range.
"This survey highlights the importance of educating American families who rent about the risks facing their possessions," said Jeff Deigl, assistant vice president of specialty product lines for Allstate. "It's a wake-up call to increase awareness of the available options to manage these risks."
The survey found that the biggest reasons renters don't purchase renters insurance are: 1) they haven't made the time to look into it (43 percent) or 2) they believe the coverage is too expensive (33 percent). Various other reasons such as not owning enough valuables to justify having the insurance and believing landlords are responsible for insuring renter's personal property were given by 23 percent and 10 percent of respondents, respectively.
Misperceptions about the price of renters insurance were particularly telling. Three out of ten respondents thought renters insurance cost at least three times as much as its actual price tag, an average of $15 per month. Another 20 percent had no idea how much it cost. When polled, six out of ten renters thought renters insurance was worthwhile, even at an average of $20 per month.
Additional Survey Stats
- A majority of renters (54 percent) say that if they could protect only one of several types of possessions from burglary or fire, they would choose personal items such as photographs or letters. Sixty-eight percent of women said they would save photos and letters compared to 40 percent of men.
- Three in ten respondents would save a personal computer, while almost one in ten would save other personal electronic devices such as an MP3 player or digital camera.
A mere 15 percent of respondents have a security or alarm system in their home and only 67 percent lock their windows when they leave. Fifty-four percent of those surveyed own a fire extinguisher.
Today's survey release kicks off a comprehensive effort by Allstate to encourage U.S. renters to better prepare for personal property losses.
Allstate has easy to use tools and valuable resources readily accessible, including home inventory check lists to keep track of all personal possessions as well as detailed information on property coverage options. Go to www.allstate.com/renters-insurance to download a home inventory checklist and for more important information. The home inventory list can also be accessed directly here http://www.knowyourstuff.org/allstate/.
The national survey was conducted online from May to June 2008 with a sample of 1,000 renters nationwide. Additional surveys were conducted online during this period with 500 renters from each of the following 13 states: California; Colorado; Connecticut; Florida; Georgia; Illinois; New Jersey; Ohio; Oklahoma; Tennessee; Texas; Virginia; and Washington. In New York State, 200 renters were surveyed in each of four upstate areas: Albany; Buffalo; Rochester; and Syracuse. All surveys were conducted by Opinion Research Corp. for Allstate.
The Allstate Corporation (NYSE: ALL) is the nation's largest publicly held personal lines insurer. Widely known through the "You're In Good Hands With Allstate®" slogan, Allstate helps individuals in approximately 17 million households protect what they have today and better prepare for tomorrow through approximately 14,900 exclusive agencies and financial representatives in the U.S. and Canada. Customers can access Allstate products and services such as auto insurance and homeowners insurance through Allstate agencies, or in select states at allstate.com and 1-800 Allstate®. Encompass® and Deerbrook® Insurance brand property and casualty products are sold exclusively through independent agents. The Allstate Financial Group provides life insurance, supplemental accident and health insurance, annuity, banking and retirement products designed for individual, institutional and worksite customers that are distributed through Allstate agencies, independent agencies, financial institutions and broker-dealers.