How to Buy Renters Insurance

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You can easily buy renters insurance online or by speaking to an agent, in part because of a growing number of reliable insurance companies in the industry. You can get coverage at any point, and it will go into effect immediately —there's no waiting period, and you usually don't need to buy before you move in.

Wherever you decide to get renters insurance, the first step is to find out how much your property is worth and decide which dangers your home faces — then, compare the costs and coverage options of multiple insurers to find the one that fits your needs.

Renters insurance repairs or replaces your damaged personal property, gives you liability coverage and provides you with additional living expenses if you are forced to leave your home temporarily. It does not pay for damage to your dwelling's structure.

Who should you get renters insurance from?

You can buy renters insurance from large providers like State Farm, Erie and Allstate as well as online-only insurers like Lemonade. In most cases, getting renters insurance doesn't take very long, especially if you choose to buy a policy online. You can buy renters insurance at any time — you don't have to do it within a certain amount of time after you move in, for example.

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What options are there when choosing renters insurance?

The fastest way to get renters insurance is almost always to get a free online insurance quote and then purchase the policy directly from the website. Otherwise,you can speak to an agent over the phone or in person.

Many of the largest renters insurance providers will allow you to view, customize and purchase renters insurance in less than five minutes.

Thankfully, it's easy to compare policies and get the best coverage for your needs. It's worth noting, however, that many companies do not operate in every state. Some will also not offer the coverage themselves but instead will partner with other insurers.

How to find cheap coverage

The national average cost of renters insurance is $18 per month, but the price changes dramatically based on where you live. For example, the average cost of renters insurance is just $12 per month in New Hampshire, but $34 per month in Louisiana.

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When deciding where to buy renters insurance, use your state’s average as a baseline while collecting quotes from different insurance companies. Remember your local area's hazards, such as weather and crime, will play in the prices you are quoted, which may be higher than the state or even national average.

Compare customer service scores

J.D. Power ratings for renters insurance

  • Lemonade: 866 (out of 1,000)
  • Erie: 865
  • Average: 842
  • Allstate: 841
  • American Family: 840
  • USAA*: 888
*Not ranked because it doesn't sell to the general public

In addition to checking the cost of different renters insurance policies, you should compare how satisfied a company's policyholders are when they make a claim. The National Association of Insurance Commissioners (NAIC) tracks the number of complaints insurance companies receive. This information can be found on the NAIC's website or through your state's insurance board.

It can also be useful to glance at J.D. Power's ratings for most companies before purchasing a policy. J.D. Power specializes in analyzing customer experience. Companies with higher scores from J.D. Power received generally positive feedback from consumers. Providers like Lemonade Insurance and USAA (only available to military families) tend to have very high customer satisfaction scores from both the NAIC and J.D. Power.

Do you need renters insurance?

There's no legal requirement to buy renters insurance, however some landlords will require you to purchase a policy. We recommend that you — or a live-in family member— keep an active renters insurance policy. Roommates aren't typically covered by each other's renters insurance unless they're also related, so each tenant will need their own policy.

At a national average cost of $18 per month, renters insurance doesn't cost much while providing effective financial protection from fire, theft and most disasters.

When you apply to buy renters insurance, you'll be asked about the value of your property. Companies often suggest between $15,000 and $40,000 of property coverage as a default choice. You can opt for a lower limit, but that's only a good idea if the value of your things is for sure less than the coverage you're looking for. Keep in mind that you'll likely accumulate more belongings over time, raising your total coverage requirement.

Also included in renters insurance is personal liability coverage. Liability insurance protects you if someone else files a lawsuit against you for property damage or injuries they suffer. Coverage typically starts at $100,000, though you can also usually purchase additional protection should you decide you need it.

When determining how much coverage to buy, you should consider your total assets and whether you have any hazards on your property, like swimming pools or certain breeds of dog.

How to buy renters insurance online

You can buy renters insurance online from most companies. Many providers supply online forms that allow you to request a quote and purchase coverage without speaking to an agent. Buying renters insurance online usually consists of three steps:

  1. Calculate the value of your belongings.
  2. Decide on the right amount of coverage.
  3. Select the best price, and adjust.

Step 1: Calculate the value of your things

You can calculate the amount of coverage you need by starting an inventory of your property. This inventory should include several key pieces of information about every item.

  • Names
  • Serial numbers
  • Descriptions of their functions
  • Prices, with appended receipts if available

Taking photos or videos of your items can also be helpful. You should store at least one copy of your inventory away from your property.

If you have to make a claim, make sure you have an inventory of your possessions, especially if you don't have replacement cost coverage.

Once you know what you own, you can decide if you have any special items like jewelry or art that wouldn't be covered by most standard renters insurance policies.Too insure these items, you'll need to purchase additional riders or endorsements specific to these items.

Step 2: Decide how much insurance coverage to buy

You will have to select a total amount of coverage for general personal property as well as any additional riders for specialty items. You will also need to select a total for liability coverage.

Liability coverage will protect you in a range of situations related to the property you're renting. Those can include:

  • If you have a pet that bites someone on the property
  • If someone is injured in your rental home and you are found liable
  • If you cause certain kinds of damage to the home you're renting
  • If your family member damages someone else's property

You will be required to input any information of other members of your family who will benefit from your insurance, like a partner or spouse. Occasionally insurers will allow you to add roommates to your policy, too. Be aware that any claims your roommate makes for their property could affect the prices of your own future premiums.

If you live in an area that's prone to certain disasters, it could be a good idea to purchase additional coverage when buying renters insurance. For instance, floods, sinkholes and earthquakes aren't typically covered by a standard renters insurance policy. If you live in a coastal region that experiences hurricanes, you may have to buy flood insurance from the National Flood Insurance Program.

Step 3: Select and adjust the best price

Before you choose where to buy renters insurance, you should make sure that you're getting the best price for your insurance requirements by raising or lowering your coverage limits and adjusting your deductible.

The price of your renters insurance is determined partly by the levels of coverage you buy. So if you're unsatisfied with a quoted price, you could try lowering your personal property protection and liability insurance on your application to see how much the price drops. However, always make sure that the coverage you buy will be enough to protect you from any losses if your property is damaged.

Companies will often offer a range of add-ons for more protection as well as discounts for home features such as dead bolts and burglar alarms. Alsol pay attention to whether your policy offers “actual cash value” for your items or “replacement cost value.” The distinction is important if something does happen to your property.

  • Actual cash value: The price your older item would have fetched at the time of the loss. This factors in depreciation, meaning an older item will be worth less than a comparable item today.
  • Replacement cost value: The price to replace your item with a similar or newer version of the item today.

You can also change your price by adjusting your deductibles. A deductible is the money that you have to pay out-of-pocket before receiving insurance money from a claim. Many renters insurance policies carry deductibles of at least $500. This means that if your $1,000 laptop was destroyed, your insurance company would deduct $500 before sending you a payment for the remaining half. If you select a higher deductible, your monthly premiums will be lower — but so will your claim payments.

Once you settle on a company, a price and coverage options, all that's left is to sign up for your policy.

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