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Avoiding the maintenance headaches of homeownership is one of the joys of renting. When your kitchen sink backs up, you can just call your landlord to fix it. But what if that sink pipe bursts and ruins your dining room furniture? Renters insurance can help protect your possessions against damage or theft. Here are six steps to getting renters insurance.
Why Do You Need Renters Insurance?
Your landlord may have insurance for the building you live in, but that coverage doesn't protect you or your possessions from dangers like fire or theft. Renters insurance helps pay to replace your personal belongings if they're stolen or damaged, safeguards you from legal liability and helps cover your living expenses if you need to move out temporarily during covered repairs.
Renters insurance can help you if:
- Your furniture and clothing are destroyed in a fire
- Burglars steal your laptop, jewelry and TV set from your apartment
- A guest falls down your stairs, is badly injured and sues you
Without renters insurance, you'd have to pay out of pocket to replace your belongings, cover your guest's medical bills or defend yourself in a lawsuit.
Learn more >> Benefits of Renters Insurance
How to Get Renters Insurance
To get renters insurance, follow these steps.
1. Check With Your Landlord
Your lease may require you to have renters insurance. If so, you'll need to buy at least the minimum coverage your landlord requires.
Some landlords ask to be named on your policy as an interested party. This means they'll be notified if you change or cancel your renters insurance.
Ask your landlord about security and safety features of your rental. For example, smoke detectors, security cameras or alarm systems on the property could earn a discount on renters insurance.
2. Understand What Renters Insurance Covers
Renters insurance includes the following coverage:
- Personal property coverage pays to repair or replace your personal possessions if they're stolen, damaged or destroyed by a risk covered in your policy.
- Liability coverage helps pay medical expenses if a guest is injured in your rental home, or legal expenses if they sue you. It may also cover damages you or your family members cause to other people or their property outside your rental home.
- Alternative living expense (ALE) coverage pays any extra living costs if you're forced to move out of your rental home during repairs for a covered risk.
3. Decide How Much Insurance You Need
There are three main steps to deciding just how much renters insurance coverage you should purchase.
- Determine how much personal property coverage you need. Do a home inventory of your possessions by filming or photographing your belongings. Begin with the most valuable items, such as furniture, appliances and electronics. Record the manufacturer, model and price of each item; scan receipts if you have them. For things like clothing, books or housewares, you can count how many of each item you have and estimate their cost.
- Figure out how much liability coverage to get. Your bank accounts, car, valuables, investments and even certain retirement plans may be at risk if you're sued by a visitor who gets hurt in your home. Make sure you have enough coverage to protect these assets. If you need more coverage than renters insurance offers, you may want to buy an umbrella insurance policy.
- Estimate your alternative living expenses. Based on rental and hotel rates where you live, how much would your living expenses go up if you had to move out during repairs? Also consider whether you'd have to eat out often or face a longer commute to work or school. ALE policies are typically capped at a dollar amount or a percentage of your personal property insurance.
Learn more >> How Much Renters Insurance Do I Need?
4. Choose Your Deductible
The deductible is the amount you're responsible for paying before your renters insurance pays out when you file a claim. You may be able to choose a deductible of $250 to $2,500 for personal property coverage.
A higher deductible generally means lower premiums, so if you have a hefty emergency fund, raising your deductible can be a good way to save. However, be sure to keep your deductible low enough that you could afford to pay it in case of a claim.
5. Get Quotes and Compare Coverage
Get quotes from several different insurance carriers. You can do this by calling insurance companies, going online or contacting an insurance agent. Make sure to compare the same type and amount of coverage, as well as the same deductible, with each insurer. Review sample policies to clarify the coverage, exclusions and limits of each policy.
Your auto insurance company is a good place to start checking prices for renters insurance. Buying both renters and car insurance from the same insurance carrier could earn you a discount for bundling.
6. Submit an Application
When you find a quote you like, you'll need to fill out a complete application. Be prepared to provide your name, address, Social Security number, birth date, how much coverage you need and the date you want coverage to begin.
Once your application is approved, pay your premium to start your coverage.
What Renters Insurance Covers
Here's a closer look at what renters insurance covers.
1. Personal Property Coverage
Property insurance pays to replace your personal belongings if they're stolen, destroyed or damaged by a covered risk. Covered risks usually include:
- Fire or smoke damage
- Theft or vandalism
- Lightning
- Windstorms
- Water damage due to structural problems, such as a burst pipe
You can choose to purchase replacement cost coverage or actual cash value coverage. Replacement cost coverage costs more, but if you have a claim, it pays to replace your belongings with equivalent new ones. Actual cash value coverage costs less, but if you have a claim, it only pays the amount your belongings are currently worth. If the items have depreciated in value, like an older TV or computer, actual cash value coverage might not be enough to replace them.
Renters insurance may cover possessions outside your home, too, such as items stolen from your car or a hotel room. And while renters insurance typically doesn't cover identity theft, some insurers offer an identity theft protection add-on.
2. Liability Coverage
Renters insurance includes personal liability insurance, which pays your legal defense costs and damages if a visitor to your rental home is injured and sues you. Liability insurance also pays medical costs for the injured person up to your policy limits. Damages or injuries you or your family members cause to others outside your home, such as your child breaking a neighbor's window, is also covered by liability insurance.
3. Alternative Living Expenses (ALE)
If your rental property is unlivable after a covered risk and you have to move out during repairs, ALE, or loss of use insurance, helps pay for you to live elsewhere. ALE insurance covers any expenses above your normal living expenses, such as restaurant or takeout meals if you're living in a hotel or extra gas if your temporary living place requires a longer commute. ALE coverage is typically limited to a specific dollar amount or time period.
Learn More >> What Does Renters Insurance Cover?
Mistakes to Avoid When Buying Renters Insurance
To get the most from your renters insurance policy, avoid these common errors.
- Not shopping around: Without comparing quotes from different insurance companies, you could end up paying more than you need to for renters insurance. Even worse, you might not get the coverage you need. It's easy to get quotes quickly online or, if you'd rather hand off the legwork, ask an independent insurance agent for help.
- Not checking with your landlord: If your landlord requires a minimum amount of renters insurance, you need to purchase at least that much coverage; otherwise, you could be violating the terms of your lease.
- Not buying enough coverage: Your coverage may fall short if you underestimate how much it would cost to replace everything you own in a worst-case scenario. Conducting a home inventory can help you more accurately calculate how much personal property coverage you need.
- Choosing actual cash value instead of replacement cash value coverage: Opting for actual cash value coverage could lower your insurance premiums—however, it could also leave you footing a big bill if you have a claim. To ensure your insurance covers replacing your belongings with comparable new ones, choose replacement value coverage.
- Not reading the fine print: Before you purchase renters insurance, be sure you understand what's covered and not covered. Review a sample policy for exclusions and limitations. Pay attention to things like caps on coverage for ALE or valuables. You may want to buy flood insurance, earthquake insurance or umbrella insurance to fill any gaps in coverage.
Frequently Asked Questions
In the United States, the average cost of renters insurance is about $166 per year, or about $14 per month, according to 2023 Experian data. However, your cost could be higher or lower depending on a variety of factors, including your coverage, deductible, location, prior claims and even your credit score.
Insurance companies in most states can run a credit check when you apply for insurance. They check your credit-based insurance score, which differs from your regular credit score but is based on many of the same factors.
Renters insurance typically doesn't cover:
- Normal wear and tear
- Damage to the structure of your rented home (your landlord's insurance covers that)
- Damage from floods and earthquakes
- Mold damage
- Bedbugs or other pest infestations
- Business equipment (you can purchase a home-based business policy to get coverage)
There may also be limits on coverage for valuables such as computers, jewelry or artwork. However, you can usually buy extra insurance for the full value of these items.
Proof of renters insurance is a document proving that you have renters insurance. Landlords often ask for proof of insurance when you sign a lease.
Usually, you can simply give the landlord a copy of your policy's declarations page, which summarizes your coverage amounts, deductible and who is covered. Some landlords may want to see your entire policy, so it's best to ask your landlord what they require. You can usually get a copy of your renters insurance policy online, through your insurance company's mobile app or by calling to have one emailed, faxed or mailed to you.
Yes, your landlord can require tenants to have renters insurance as a condition of the lease. Landlords that require renters insurance generally specify the minimum liability coverage you must buy. If you don't have renters insurance and someone is injured at your rental home, the landlord could be liable for medical or legal expenses. Your renters insurance helps shield the landlord from legal liability.
The Bottom Line
Shopping around can help you pay less for renters insurance. So can good credit. Insurers in most states can check your credit-based insurance score when you apply for renters insurance. Although this score differs from your consumer credit score, both use information from your credit report, so checking your credit score provides a good indication of your credit-based insurance score.
Habits like minimizing credit utilization and paying bills on time could help raise both scores, which may lower your renters insurance rates. Signing up for Experian Boost®ø is another way to improve your credit score and potentially save on renters insurance. Experian Boost is a free feature that can add your rent payment history to your credit report. Timely rent payments can help improve your FICO® Score☉ , potentially saving money on renters insurance.
