Renter’s insurance, also known as tenant insurance, is an insurance policy that protects you and your belongings whenever you are renting a house or apartment. It’s often very cheap because it is very limited in what it covers. For example, it doesn’t cover the structure itself (that’s what the landlord’s insurance covers), which is often a big financial risk.
However, if there is an unexpected event that damages your belongings or forces you to move out, renter’s insurance is what will step in to help you out. Renter’s insurance is usually set up in three parts – personal property coverage, liability coverage, and additional living expenses coverage.
Personal property coverage protects your belongings if they are damaged, destroyed, or stolen. Liability coverage protects you if you accidentally damage someone else’s property or someone gets hurt in your apartment (and you were found responsible).
Additional living expenses coverage will pay for finding alternative living arrangements if your apartment is damaged or uninhabitable.
For example, years ago the tenant living in the apartment above my niece fell asleep while smoking, and his apartment went up in flames. Luckily, everyone escaped and there were no injuries to people or pets. However, several apartments were a total loss.
My niece’s renter’s insurance was her only saving grace. Without it, she would have been on the hook for the cost of replacing the items in her apartment.
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Do I Need Renter’s Insurance?
Yes, you do. When you own a home you have homeowner’s insurance. This insurance covers the structure itself and all of your belongings. The owner of your rental home or apartment building should have this type of insurance but it covers what belongs to the owner – it does not cover what belongs to you.
Most homeowners insurance policies won’t cover a tenant’s property and personal belongings in a rental situation. For that reason, you do need to have your own renter’s insurance policy.
Without one, you could be stuck paying to replace everything you own out of pocket. And that could add up to be tens of thousands of dollars’ worth of belongings. Therefore, it’s important not to skimp out where insurance is needed.
What Does Renter’s Insurance Cover?
Renter’s insurance protects you, the renter, directly from a variety of occurrences.
For instance, it could cover replacements in the event of a fire like the one that occurred in my niece’s apartment building. Or it could cover replacement costs if there were a burglary in your apartment – or even if items are stolen away from home, say out of your car. It could also pay for temporary housing if you are displaced while your apartment is being repaired.
If someone is injured in your rental due to your negligence the renter’s insurance policy could cover their medical bills. There are even renter’s insurance policies that protect you if your dog bites someone while in your apartment or rental home.
Depending on the policy, you could even be covered if you accidentally damage someone else’s property. Say, for example, you hit a baseball through someone’s window or you are visiting a friend and accidentally knock over an expensive vase.
There are a lot of variables and options, this is why knowing the details of your policy is important. When you sign up to purchase renter’s insurance, the company you sign up with will ask you a lot of questions. You’ll need to make decisions concerning what kind of coverage you want, the deductible amount you want to pay, and more.
Renter’s Insurance Coverage Basics
Here are some basic things you need to know about renter’s insurance before you buy.
Deductible
Your deductible is the amount you pay out of pocket before your insurance company reimburses you for losses. You choose your deductible amount – it could be $250, $500, $1,000, or more.
Replacement Cost Or Cash Value
Insurance policies typically cover in two different ways: Replacement cost and cash value. Cash value coverage gives you the amount in cash your items would actually gain if you sold them in the condition they are in.
Replacement cost coverage gives you the amount of money needed to replace the items with a new item of similar style and quality.
For example, a used couch might sell for $100 (the cash value) but a new couch of similar quality might cost $1,000 (replacement cost).
You’ll need to decide the details of how you wish to design your policy to best suit the type of coverage you want to have.
Read The Fine Print
And as with all contracts, it’s important that you know what occurrences are covered by your renter’s insurance policy. For instance, some policies don’t cover floods or sewer backup. Know exactly what’s covered by each policy you’re looking at before you make your decision to purchase.
Next, we’ll give you some details on the best renter’s insurance companies so you can make an informed decision as to which renter’s insurance company you want to use.
Lemonade
Lemonade is a relative newcomer in the insurance market but is making a splash with its unique business model.
Other insurance companies keep money not used to pay out claims as profit, Lemonade does things differently. They take a flat fee out of premiums for services provided.
Any money that’s left over (after paying out claims) is donated to charity. Lemonade chooses the charities they give to based on what each member suggests. So, you choose the charity your extra premiums go to.
Where Lemonade shines is its use of artificial intelligence to quickly set up customers with insurance coverage that makes sense. You can apply either online or through the mobile app (available on Android and iOS). Claims are a breeze with Lemonade, too; they’re often completed and paid out in a few minutes.
Lemonade renter’s insurance is available in 27 states and Washington D.C. New states are being added regularly. Check out the Lemonade website for more information.
Also, they offer bundling options because they offer several types of insurance. There are also discounts when you pay your premiums annually, as compared to monthly.
Allstate
Allstate is one of the largest insurance companies in the world and has been in business since 1931 and is available in all 50 states.
Known for its auto insurance, Allstate is also a great place to look for renter’s insurance. Customers can get online quotes for insurance rates or work with a local Allstate agent for more personalized service.
With a multitude of insurance types available, Allstate is a great place to get renter’s insurance if you are already an existing customer or want to earn discounts for bundling coverages.
Rates for renter’s insurance start at $4 when bundled with car insurance.
Allstate offers other discounts too, like:
- Safe home discount
- Discount for people over 55
- Claims-free discount
- Auto payment discount
Allstate’s mobile app, available on Android and iOS, has a Digital Locker feature, which allows you to catalog your personal property to speed up future claims.
While it covers personal property, along with other liability protections, Allstate also offers add-ons to increase coverage if needed. Allstate offers affordable protection and everything else that a renter needs.
Liberty Mutual
Liberty Mutual has been providing insurance coverage for over 100 years and is the third largest insurance company in the US and is available in all 50 states.
You may be familiar with its commercials for auto and home insurance, but Liberty Mutual provides renter’s insurance too.
Quotes for renter’s insurance are available, both, by phone or through Liberty’s website. There’s an option to save money by bundling it with other insurance coverages. Customers receive a discount for having no claims for five years or more. Liberty Mutual has other discounts available too, including:
- Auto payment discount
- Online purchase discount
- Early shopper discount
Renter’s insurance starts as low as $5 and includes coverage for personal property, liability, additional living expenses, and medical payments. Customers can also add coverages like earthquake insurance and personal property replacement cost.
Their “blanket jewelry” add-on option covers jewelry that’s lost or damaged even if it wasn’t lost or damaged at home. Note that the company website says that renter’s insurance add-ons might not be available in all states.
Nationwide
Nationwide is another place to look for quality renter’s insurance. Quotes are available online, by phone, or through a local Nationwide agent. Insurance coverage is customized to fit your specific needs, which means you don’t pay extra for what you don’t need.
Loss of use, personal property, medical payments to others, liability, and some unauthorized credit card transactions are included in standard coverage. Nationwide has optional protections you can add for extra security.
They also have an add-on coverage benefit that may cover damage to improvements or fixtures you made or installed yourself. Talk to a Nationwide agent for more details.
Through Nationwide’s online access, customers can: view their accounts, pay bills, file and track claims, set up automatic payments, and make changes to coverage.
Policies start at $20 per month.
Like other insurance giants on the list, Nationwide offers more than just renter’s insurance and provides discounts for bundling insurance policies.
Nationwide goes a step further, offering retirement and investment solutions, along with banking products (through Axos Bank). If you like the convenience of only dealing with one company for financial needs, Nationwide might be a good fit.
Nationwide is available in almost all 50 states. They’re not available in Massachusetts and Louisiana. Coverage options may vary by state.
State Farm
Founded in 1922, State Farm is another large insurance company with renter’s insurance coverage. Rate quotes are available online and only take a few minutes to receive. Coverage is customized to fit your specific needs. If you need extra coverage, State Farm has add-on options like identity restoration, earthquake, and additional liability coverage.
Customers can file claims online or through State Farm’s handy mobile app. The app is available on Android and iOS and has other cool features like claims tracking, document uploading, and the ability to connect with your State Farm agent.
State Farm is known for auto insurance, which you can bundle with renter’s insurance to save money. With consistently low rates and excellent customer support, State Farm is an excellent option for renter’s insurance.
State Farm is another company with banking, credit card, and loan options for customers. While it provides convenience, you may get better products and services by searching each category separately instead of choosing an all-in-one company.
USAA
USAA renter’s insurance starts for as little as $10 a month. It does require USAA membership, which is limited to: active, enlisted, and veterans of the U.S. military, select family members, and other eligible individuals.
Its standard coverage includes things that often are add-ons through other insurance companies, but without the upcharge. Standard USAA coverage includes, both, earthquake and flood coverage. Military families are often on the go. With USAA, your possessions are covered even while in storage anywhere in the world.
Like other companies on this list, USAA offers discounts for bundling insurance coverage. Standard coverage includes liability and personal property protection but is customizable to fit specific needs.
USAA is a great option for military members and their families. Beyond insurance coverage, USAA membership comes with benefits and tools not available to the general public. Plus, they have a unique understanding of the needs and problems that members may face.
AARP
AARP offers renter’s insurance through a partnership with The Hartford. AARP offers one of the best insurance solutions for people over the age of 50.
Standard coverage through AARP and The Hartford includes:
- Personal property
- Personal liability
- Medical payments
- Property damage to others
- Additional living expenses
Additional coverages are available for purchase, including water backup, earthquake, and replacement cost coverage. ProtectorPLUS Zero Deductible Benefit coverage waives deductible fees, up to $5000, if you experience a qualifying loss of $27,500 or more. Another insurance coverage that’s unique to AARP is assisted living care coverage. It extends liability to individuals who used to live with you but are now living in an assisted living facility.
Customers file claims by calling The Hartford’s claim center, which is available 24/7. AARP membership is not required to qualify for renter’s insurance but does provide access to valuable discounts and benefits beyond just insurance.
You can save money by bundling car insurance from The Hartford with your renter’s insurance. You can also get a discount if your rental property has a 24-hour security service. You’ll, also, get discounts every time you renew your insurance policy. Retirement isn’t always easy to navigate. Through The Hartford, AARP offers insurance solutions that make sense for retirees.
MetLife
Metlife is a global leader in the insurance industry. It is known for its health and dental insurance, life insurance, and homeowners insurance. It, also, has affordable renter’s insurance rates for customers looking for protection for personal possessions.
Coverage through MetLife is customizable. You only pay for the coverage you need. In some states, there are options to add-on extra coverage to maximize the protection of valuable items.
Renter’s can save money with Metlife by bundling protection with auto insurance. Other discounts offered include claim-free and protective devices discounts. You may be eligible for additional discounts depending on your employer or membership with specific associations.
MetLife accounts are accessible online. Currently, this only includes options to view and print documents and make payments. For change requests, customers must call MetLife’s customer service. To make claims, you’ll need to contact its claims department, which is available 24/7.
American Family
American Family Insurance offers some of the most competitive rates on the market for renter’s insurance. It’s great to know that you can find affordable insurance for your personal property. Plus, you can customize your quote, so you don’t pay for extra coverage you’ll never need.
Convenience is a trademark of American Family Insurance. The MyAmFam App is a great time-saving tool for customers. Through the app, customers can file and track claims, make payments, and set up auto payments. Available on Android and iOS, the app is also great if you have auto insurance through American Family. It comes with quick access to proof of insurance and roadside assistance too.
Customers can save considerable money by bundling AmFam auto and renter’s insurance together. Other available discounts include paperless and autopay discounts.
Originally created to serve the farming community, American Family Insurance is now one of the largest insurance companies serving families across America. If you’re in the market for renter’s insurance, be sure to check available rates through American Family Insurance.
GEICO
GEICO Insurance was founded in 1936, and it’s the company I’ve personally used for insurance for many years. Note that when you get a renter’s insurance policy through GEICO, the policy will be managed by GEICO but underwritten by a partner company such as Liberty Mutual.
GEICO renter’s insurance policies and can cover basic rental insurance as well as extras such as medical/legal coverage in the event that a guest gets injured on your property. It will also cover you if you accidentally damage someone else’s property. For example, if you hit a golf ball into a window or your child breaks a vase while visiting a friend.
They also offer an add on coverage for jewelry
Policies start at just $12 per month and you can get discounts for paying a whole year upfront and bundling the renter’s insurance with other policies. Additional discounts for home security systems and smoke alarms as well.
Farmers
Farmers was founded in 1928, has over 48,000 independent and exclusive agents, and is available in all 50 states. What started out as an insurance company catering to rural and farm-owning residents has morphed into one of the most recognized insurance companies in the U.S.
Farmers’ renter’s insurance policies can include coverage options that go beyond the basics, including coverage of temporary relocation costs in the event you can’t live in your rental for a while after it sustains damage. So if there is a burst pipe and you have to move out for repairs, Farmers will cover your extra living expenses while you’re displaced.
You can also add on coverage for replacing old electronics items with new versions. Say your computer from 2010 is stolen, with this add on you could buy a brand new computer, rather than just being compensated for your 10-year-old version.
They even offer identity theft protection that can be added to your renter’s insurance.
The Farmers Insurance website doesn’t disclose the minimum or average price. However, it does recommend checking out bundling options for potential discounts on renter’s insurance.
Progressive
Progressive was founded in 1937 and is now one of the largest insurance providers in the United States and is available in most states. They’ve got loss of use coverage (like other companies) that will pay for living expenses if the rental is unliveable for some reason, such as having repairs done. This coverage pays for costs over and above what you’d normally have to pay while you’re away from your home.
They cover water damage from things like broken pipes or malfunctioning appliances but not flooding. Flood insurance is available as an add on coverage if you want to include it. Legal coverage for guest injuries is also an optional coverage choice. Be sure to get the fine print details on the coverage before purchasing a policy.
The Progressive website doesn’t quote a renter’s insurance price. However, the site does state that it gives discounts on bundling, paying upfront, and more.
Summary
Renter’s insurance is an important aspect of financial protection for people who rent a home or apartment. Just as you shouldn’t go without auto or other types of insurance, you shouldn’t go without renter’s insurance unless you’re completely financially stable.
Renter’s insurance claims from property damage or liability claims for injured guests can add up to a lot of money very quickly. So be sure you’ve got the peace of mind that comes from having the right type of insurance for your situation.
Do you have renter’s insurance? If so, which insurance company do you get your renter’s insurance with. And have you been happy with them? Feel free to share your thoughts in the comments section.
So, what’s stopping you from getting renter’s insurance?
