Sticks and Bricks

The horrific tornado that devastated parts of Oklahoma this week has been deemed an EF5. The National Weather Service classifies an EF5 as the strongest category of tornadoes, generating winds of up to 210 miles per hour.  Thankfully, the number of lives lost remains low but initial property damage estimates are at $3 billion.

The stories are heart-wrenching   The destruction is nuclear.  The remains are nothing more than sticks and bricks.

After a 25 minute reign of terror, the monster tornado left.  First responders began the search and rescue mission.  Now the cleanup and rebuilding begins.  Enter Red Cross, FEMA and insurance.

The good news is that, unlike Superstorm Sandy, this tornado has no complications of flood insurance.  A tornado is a tornado is a tornado.  Windstorm.  Covered by the vast majority of insurance policies.

The bad news is, just like Superstorm Sandy, many of the victims are renters. Renters without insurance.

According to a recent study, nearly 70% of renters don't have renters insurance!  WHY? Surely it is not the cost.  The National Association of Insurance Commissioners reports the average renters policy costs under $200 a year.  Less than $200 per year.  Let's break that down.

$200 a year

$16.67 a month

That minimal premium policy would likely provide:

$15,000 contents

$4.500 loss of use

$500,000 liability

Consider this:

The average single American's monthly cell phone bill is $71.

The average American's cable bill is $86 per month.

Personally, I think the number of uninsured renters is because renters erroneously think that their landlord is responsible for their property.  They think that the landlord insures their property.  Nothing could be further from the truth.

Unlike a smart phone or cable, insurance is not a "fun" product to spend money on.  The actual policy document, be it paper or electronic, won't give you a warm and fuzzy feeling.

What insurance can do is give you peace of mind.  Peace of mind, Renter, that when a tornado or fire leaves you with nothing but sticks and bricks, you will be able to replace your belongings, find temporary housing and begin the process of recovery.