Renters Insurance consumers come in two main varieties (there are others, but largely irrelevant to the topic at hand.) The people that choose to transfer the risk and then the ones that decide to self-insure.
Risk Transfer is when you pay a company money to assume the risk of loss – I pay my premium, the company agrees to cover some of my costs should certain events occur. Most people choose to transfer risk to an insurance carrier. This is what happens when you purchase renters insurance.
Self-insurance consumers come in three flavors: Ones who can’t afford insurance, ones who think it won’t happen to them, and ones that have enough money to retain the risk.
The ones who can’t afford renters insurance are the ones who most baffle us. No, I’m sure you can’t afford that fifteen dollars a month. However, if you don’t have fifteen dollars a month, you certainly can’t afford to replace all your property in, for example, a fire.
Insurance isn’t something you buy because you can afford it. You buy insurance because you can’t afford to be without it. “Retail workers in New York City earn a median of $9.50 an hour…” Best case scenario, 40 hours a week and no time off, that works out to $19,760. At minimum, a New York renters insurance policy (for an average of ten dollars a month) would pay up to $15,000 for your property losses. Without accounting for taxes, the median salary would require nine months of work to provide the same coverage as a renters policy!
The study, based on interviews with nonunion workers, largely found poverty wages and highly unstable schedules for the states retail employees, with less than a fifth having a set schedule each work week. The study said many workers had a hard time planning for, say, child care or classes because more than half learned their schedules a week or less before a work week would begin.
The study, “Discounted Jobs: How Retailers Sell Workers Short,” was led by a City University professor and was based on face-to-face interviews with 436 nonunion employees of retail businesses, ranging from high-end establishments on Fifth Avenue to discount stores on Fordham Road in the Bronx. The researchers went to department stores, electronics stores, home centers, clothing stores, bookstores and others.
The report was financed by the Retail Action Project, an organization in Manhattan that is financed by unions and foundations; by City University’s Murphy Institute; and by the Retail Wholesale and Department Store Union. Two in five workers interviewed said the number of hours they worked each week always or often varied. One in five said they always or often had to be available for call-in shifts, with some workers saying they were assigned one or two days of work each week, but had to leave open another two or three days and call in those mornings in case their employers needed them.
The report said, “Guaranteed work hours are no longer the normal and just ‘getting on the schedule’ has become the reward for job performance.” Workers who rack up more sales per shift were often assigned more days.
The point for sighting this study is to point out exactly why the people who think they can not afford renters insurance are actually the ones that need it the most.
The next study that we will point out is for those renters insurance consumers that that self-insure since they think it will never happen to them.
According to the National Fire Protection Association Fire Analysis and Research Division. U.S. fire departments responded to an estimated 1,389,500 fires. These fires resulted in 3,005 civilian fire fatalities, 17,500 civilian fire injuries and an estimated $11,659,000,000 in direct property loss.
That is a lot of fires and even more property damage. So if you think it will never happen to me think again.
For those rich people in the third group that have enough money to retain the risk… Why are you reading this article.
To find the most affordable way to protect yourself from financial catastrophe call Effective Coverage at (800) 892-4308 or get a quote online.