Renters Becoming The Uninsured In Florida

Nov. 10--The 2017 hurricane season exposed an insurance gap across a state that is being redefined by renters, who are far less likely than homeowners to insure their belongings.

The tab to cover renters' disaster-related damage often falls in public hands. The Federal Emergency Management Agency pays renters to repair or replace furniture, appliances, clothing, text books, and job-related equipment -- possessions covered in many homeowner and renter insurance policies.

FEMA said this week that 432,286 Florida renters applied for aid through October.

"If you're a renter, you may think you don't have to worry much about damage to the property you call home," said Lynne McChristian, a professor at Florida State University. "But that does not mean you have zero financial risk. If you read through your lease, you may find you owe rent even if you can't live in your rental."

Most landlords in Florida don't require renters to carry insurance, added McChristian, Florida representative for the Insurance Information Institute research group.

More Florida residents are renting, with homeownership down to 64 percent, according to the Federal Reserve. Back when a trio of hurricanes slammed Florida in 2004, the state's homeownership rate stood at more than 72 percent. Not long after, the recession brought a wave of foreclosures.

Florida's gap in insurance coverage is apparent since the market bottomed out: While the state population grew 8 percent during the last eight years, the number of homeowner policies barely budged, according to Florida's Office of Insurance Regulation. Homeowners who carry a mortgage typically are required by lenders to have insurance.

The Insurance Information Institute cites that only 41 percent of renters nationally have coverage. McChristian said rates are likely similar in Florida.

Increasingly, property managers in Florida have started requiring that tenants pay for renters insurance covering personal belongings. Cost often runs $200 a year. Yet most renters still lack the coverage -- a stark contrast to the 90-plus percent of homeowners with policies, as required by their mortgage companies.

Kim Meredith-Hampton, Florida president for the National Association of Residential Property Managers, said her own company manages about 1,000 rental homes in mid-Florida and started requiring renters insurance in the last year.

"I really think in the next two years, you're going to see everyone in the industry asking for it," said the co-owner of Hampton & Hampton Property Management & Leasing.

Altamonte Springs-based Wendover Housing Partners called for renters insurance years ago at its market-rate apartments, regional manager Lynn Edmondson said. The policies, Edmondson said, make financial sense.

"You take a four-story building and have a fire on the fourth floor. The sprinkler goes off with damage throughout. It could be damage to adjoining units," she said. "If they have renters insurance, it will cover that. We take care of the building. But their couches, mattresses, clothing and all their personal items? A lot of people don't have that kind of money to replace all those items."

Not only do tenants have to scramble to find or borrow basic possessions, but they can suffer added bills if they contributed to damage to the unit, she added. Tenant-caused damage to carpets and other items owned by the landlord can be covered by renters insurance.

Syeda Hassan, a resident at Wendover's Weston Park complex in Longwood, said she came out of Irma unscathed but was still glad she had the insurance. She said the cost runs about $12 monthly.

"In a way it's good but at times, when you're moving and new at a job, you feel like it's a burden to arrange," she said. "But in time it's worth it."

Renters' insurance is a rare commodity at apartments where tenants can least afford to replace damaged or stolen belongings. With about 1,100 affordable rentals from Sarasota to Kissimmee, landlord Travis Vengroff estimated that less than 5 percent of his renters carry the coverage.

"We advise tenants in our lease agreements that they should get it, but it's not something people take seriously," he said.

But when families struggle to make ends meet, he added, even a small monthly amount for insurance can be out of the question.

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