Dozens of insurance companies provide renters insurance and tens of options in the renters policy you can customize. Why do you need renters insurance? How much coverage should you choose? What is the average premium in your city? What risks are not covered by renters insurance? We want to answer those questions in this article.
Why do you need Renters Insurance?
When you rent an apartment, a townhouse, or a single-family home, your landlord usually has landlord insurance for the property which covers the building. However, when unexpected happens, you need renters insurance to protect your personal belongings, such as your laptop, furniture, clothing, etc.,
In addition to your personal belongings, renters insurance also covers your liability if someone gets injured on your property. Commonly, landlords will have a minimum requirement on the liability amount.
💡Takeaway: Renters insurance covers your personal belongings and liability for others' injuries on your property.
What are the types of coverage for renters insurance?
Below are the most standard types of coverage. The range may vary from state to state and company to company. You should always check your own policy to review the limits of your coverage.
- Personal Property
It is the total value of your stuff. It commonly includes furniture, clothing, and electronics. You should be aware that most carriers exclude expensive items such as jewelry, art, cameras, or high-end bicycles in this coverage. Studies show that the average person has $35,000 worth of personal possessions. - Liability
It covers your bills when you're responsible for injuries on your property. According to our quote data, this coverage impacts less than personal property to your final premium. - Loss of use
When your property becomes unlivable under a covered reason, this is the max living expense you can reimburse. - Medical payment
It is the maximum medical expense you can reimburse if your guest or neighbor gets injured on your property. - Deductible
For each approved claim, this is the amount you need to pay. It impacts your premium significantly.
💡Replacement cost vs. Actual cash value
If you read replacement cost or actual cash value from your policy, these are two methods to measure the value of your lost stuff. The replacement cost means the item's total value, while the ACV is the value reduced by the amount the item has depreciated.
What are the steps for purchasing a renters insurance policy?
So you’ve decided that renter’s insurance is a good investment and want to protect your belongings. (Smart decision!) Now what?
- Calculate the total value of your belongings.
Evaluate the value of your furniture, clothing, and electronics. The majority of policies have a limit on costly items, so consult with your provider. For example, Lemonade requires that expensive bicycles and jewelry be listed separately. Our quote history shows customers usually choose a personal property policy starting at $5,000. They may then go up to limits from $10,000- $30,000. - Check your lease agreement to determine your liability.
If your landlord has a requirement for tenants to purchase renter’s insurance, they usually have a minimum liability requirement listed directly in the lease agreement. As a general idea, some high-end apartments require liability policies in the range of $300K. - Choose your deductible wisely.
If you need to make a claim, this is the amount that you will be required to pay out of pocket if your claim is approved. Higher deductibles mean lower premiums. However, be sure you have chosen a deductible that fits your particular financial situation. In comparison, a lower premium seems nice, but that higher deductible can be a strain in the event of a loss. - Consider other parties that may need to be covered under your policy.
You can add your landlord as an "interested party" to your policy, allowing them to be notified if your policy is canceled. Most companies cover your spouse by default, but some may ask you to list your spouse's name or other details. Be sure that you verify that your spouse is covered.
If you have roommates, you may need to do further research. Some policies cover roommates, and some do not. While Lemonade does not cover roommates under their policies, and your roommates will need to purchase their insurance, Liberty Mutual will allow coverage of up to 3 roommates on a single policy.
💡Note: Read your policy carefully about the limit of your item. If your expensive items exceed the limit, you need to talk to your agent or call the customer service line to endorse those items.
How much is renters insurance?
The national average for renters insurance is around $179 per year. The premium is determined by factors such as your location, age, coverage, etc.; in some states, your credit report is also used to determine your premium. Below is a summary of the average renters insurance price in the US. You can click any state to learn more details.
| State | Average Annual Premium |
|---|---|
| Alabama | $235 |
| Alaska | $166 |
| Arizona | $178 |
| Arkansas | $212 |
| California | $182 |
| Colorado | $159 |
| Connecticut | $192 |
| Delaware | $159 |
| District of Columbia | $158 |
| Florida | $188 |
| Georgia | $219 |
| Hawaii | $185 |
| Idaho | $153 |
| Illinois | $167 |
| Indiana | $174 |
| Iowa | $144 |
| Kansas | $172 |
| Kentucky | $168 |
| Louisiana | $235 |
| Maine | $149 |
| Maryland | $161 |
| Massachusetts | $194 |
| Michigan | $182 |
| Minnesota | $140 |
| Mississippi | $258 |
| Missouri | $173 |
| Montana | $146 |
| Nebraska | $143 |
| Nevada | $178 |
| New Hampshire | $149 |
| New Jersey | $165 |
| New Mexico | $187 |
| New York | $194 |
| North Carolina | $157 |
| North Dakota | $120 |
| Ohio | $175 |
| Oklahoma | $236 |
| Oregon | $163 |
| Pennsylvania | $158 |
| Rhode Island | $182 |
| South Carolina | $188 |
| South Dakota | $123 |
| Tennessee | $199 |
| Texas | $232 |
| Utah | $151 |
| Vermont | $155 |
| Virginia | $152 |
| Washington | $163 |
| West Virginia | $188 |
| Wisconsin | $134 |
| Wyoming | $147 |
💡Note: Click the state to view more details.
Ready to start shopping around for your renters insurance? Hit the big button below to get your free quotes.
What companies offer renters insurance?
Most insurance companies like Liberty Mutual, Farmers, and GEICO, who sell auto insurance, also offer renters insurance. In addition, companies such as Lemonade and Assurant primarily provide Renters insurance. Below is a comparison between those two options.
| Standalone | Bundle with auto insurance |
|---|---|
| Lemonade, Assurant, etc., | Liberty Mutual, Allstate, GEICO, etc., |
|
• More brands and price options • The company may have a partnership with your landlords |
• Save money on your auto insurance • Manage multi-policies at the same place |
You can also shop around to see what is the best option for you. Click here to start a free quote to compare multiple companies for your renters insurance.
What is not covered by renters insurance?
Renters insurance does not cover all the risks. For example, if you live in an area with higher risks for such perils as flood or earthquake, you may need to purchase specific insurance for those perils separately.
If you have a pet and want health insurance for your loved ones, consider buying pet insurance.
Does renters insurance cover roof leaking?
Renters insurance focuses on providing coverage for the renter, which does not cover any property damage, including roof leaks. Instead, the owner/landlord is responsible for their insurance to cover those costs. However, renters insurance policies can give you protection for the following things: medical expenses for any injuries sustained in the emergency, personal property damage by the roof leaking, living expenses such as finding a new place to live after the current residence is damaged, personal liability, etc.
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