If you are renting, having renters insurance is important to protecting your family and belongings. Insurance is a necessary part of renting. However, it can often feel like an extra cost that you don’t want to pay.
Instead of viewing renters insurance as a burden, use it as a tool to protect yourself without breaking the bank. Use some of these tips to save money on your renters insurance while still getting enough coverage.
What is Renters Insurance?
Renters insurance is a type of insurance that is specifically for renters who do not own their property. The landlord will have their own property insurance, but the tenant should have renters insurance.
Renters insurance is generally cheaper than the homeowner’s property insurance. The difference is that renters insurance covers different things, mostly the tenants personal property.
Renters insurance primarily insures your personal belongings inside your rental property, not the structure itself. It would cover damage or loss of clothing, electronics, jewelry, art, and furniture. This could be due to flood, fire, theft, or natural disaster.
Renters insurance can also cover bodily harm if you or a guest is injured. It can help pay for rent if you are unable to live in in the property due to a disaster. Renters insurance is a great way to make sure that your personal belongings are protected and safe.
Do I Need Renters Insurance?
If you are renting a house or apartment, you will likely need renters insurance. In many cases, the landlord actually requires you to have renters insurance are a requirement of the lease.
Renters insurance is a very good idea to protect yourself, even if it is not required. Without it, you could lose your personal belongings if there is an unfortunate event in your rental property. Renters insurance can help protect against fire, flood, or burglary by reimbursing you for lost property.
For a few dollars per month, having renters insurance is a great way to give you additional peace of mind. If you do not have renters insurance, you may end up paying a lot more.
What Renters Insurance Covers
Renters insurance covers a few different things while you are renting a property and have a problem. It helps to protect your personal property while also reducing your liability in case of an accident.
Personal Property
If there is an unforeseen accident that happens in your rental property, renters insurance helps to replace your personal property. This could be something like a burst pipe that floods the apartment, a fire, vandalism, or an electrical surge. If your clothing, furniture, TV, or other property is damaged, the insurance will replace it.
Personal Liability
Personal liability is when you are responsible if you are sued for injury or damages by another person. Renters insurance provides liability coverage to pay up to the policy limit for any legal expenses. For example, a visitor may trip and get hurt. They then may decide to sue you. Renters insurance will help cover your personal liability if you are sued.
Medical Payments to Others
If someone gets hurt in your home and has to pay for medical bills, renters insurance will help to cover it. This is another way to limit your liability and not pay for guests medical bills out of your own pocket.
Loss of Use
Another aspect that is covered by renters insurance is loss of use of the property. Let’s say that some covered disaster makes your property uninhabitable and you have to move out for a few weeks. Renters insurance will cover the costs of you having to live somewhere else temporarily. This can include hotel bills and short-term rentals.
Optional Coverage
Some insurance companies give options for additional coverage. These will cost extra but could be worth it. For example, you could pay extra to cover valuables like jewelry or art. If you like in an earthquake prone area, you can also pay for earthquake coverage.
What Renters Insurance Does NOT Cover
There are a few things that renters insurance does not cover. Always read the terms of your insurance agreement. However, here are some things that are normally excluded.
- The physical building and property
- Accidents that happen in common spaces, like a shared pool or sidewalk
- Expensive belongings like high-end jewelry, electronics, or art
- Floods
- Earthquakes
- Mudslides
- Avalanches
- Acts of God
How Much Does Renters Insurance Cost?
Renters insurance is less expensive that property insurance because it does not cover the actual structure. While property insurance can be several thousands of dollars annually, renters insurance is usually cheaper.
Depending on your coverage levels and where you live, renters insurance could cost as little as $125 per year. Other areas could cost up to $250 per year. Insurance could pay back thousands of dollars if you have a claim, so it is a pretty good deal.
How to Save Money on Renters Insurance
Even though renters insurance is not thousands of dollars, it is an extra expense that adds up. Saving money on your renters insurance just helps you to pay for something else or invest a little more.
So, how do you save money on your renters insurance? Here are a few ideas to cut your insurance premium.
- Use your existing insurance company. If you are using Geico or Progressive for your auto policy, stick with them for renters insurance.
- Bundle your policies together. You will probably need to specifically ask to bundle your auto and renters policies together. If you do, it can save you money.
- Install a security system. Insurers will lower your premium if they think there is less of a risk of burglary.
- Replace your smoke detectors. Having an adequate amount of working smoke detectors helps to reduce fire risk and will reduce your premiums.
- Increase your deductible. By offering to pay more for your deductible, you can lower your insurance premiums.
- Ask for senior, occupational, and veteran discounts. Some insurers will offer discounts for being a veteran or being over 55 years old.
- Pay upfront. Paying monthly or quarterly often ends up costing more since they will charge a fee to do this. Save money by paying the full renters insurance premium upfront.
- Check your rates annually. Instead of just renewing every year, make sure that the price hasn’t gone up. If it has, it may be time to move to a different company to save money.
Where to Get Renters Insurance
You can get renters insurance from most insurance agencies. If you already have a different insurance policy, you can use that company. If you are looking for a new insurance company, here are a few to choose from.
Geico Renters Insurance
Geico is known for their auto insurance but they also offer home and renters insurance. As funny as their ads can be, they are a great company to get renters insurance from with reasonable rates.
USAA Renters Insurance
USAA is a another great insurance company that is for veterans and military families. If you have served in the military, USAA can help you get affordable renters insurance.
Lemonade Renters Insurance
Lemonade is a relatively new insurance company but they have quickly grown in popularity. They offer online quotes for renters and home insurance with transparent pricing and aggressive rates. If you are looking for great value, Lemonade is a good place to start.
Progressive Renters Insurance
Progressive is a full-service insurance agency that provides the ability to bundle with home and auto insurance. This means that you can save money on your renters insurance while also having access to a full insurance company.
Other Renters Insurance Companies
There are many other companies that you should check out when you are shopping for renters insurance. Some of these include:
- State Farm
- Farmers
- American Family
- Allstate
- Nationwide
- Liberty Mutual
Getting the Most Out of Your Renters Insurance
When you start renting a new property, it is time to find renters insurance. It will protect your personal belongings from a wide range of incidents that may destroy them. Your property can be replaced for a few hundred dollars, if it is destroyed.
When you are looking for renters insurance, be sure to compare quotes from a few different companies. You can tailor different prices and coverage levels to fit your needs.
In the end, it won’t matter which company you end up going with. You will be glad you have renters insurance if an accident happens.
