Wisconsin Renters Face Property Losses

As the number of Wisconsin residents renting homes increases with the current housing foreclosure crisis, a new survey released by Allstate finds most renters are inadequately prepared to protect their homes and belongings.

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. With no relief in sight for the housing market, it is critical for renters to be prepared to protect their homes and possessions in case of a loss.

While homeowner 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 roughly half of the approximately 87 million Americans living in rental housing do not have insurance to cover their belongings in case of loss.

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.

Allstate's survey 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. Without home inventory check lists, renters may face challenges when filing a claim to replace stolen or damaged property, possibly delaying payment from their insurance provider. 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. 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 roughly in this range.

Misperceptions about the price of renters insurance were particularly telling. Three out of 10 respondents thought renters insurance cost at least three times as much as its actual price tag of an average of $15 per month, and another 20 percent had no idea how much it cost. However, when polled, six out of ten renters thought renters insurance was worthwhile, even at an average of $20 per month. In reality, if a renter were to lose all of their belongings such as furniture, clothing, electronics, a flat screen TV or an iPhone, this minimal investment could mean tens of thousands of dollars in savings to replace the entire contents of the individual's home.

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.