Cheap Renters Insurance Cost Comparison: Best for Apartment & Home

Harvard University has released research that shows an ever-increasing number of Americans prefer renting over buying a home. This trend has been growing for decades, and it does not show any signs of failing. This means that millions of people renting will want to (or be made to) purchase renters insurance to safeguard their personal things.

Overview

Whether or not your rental contract forces you to take out renter’s insurance, getting a policy provides a great deal of peace of mind. The best news is that the premiums are surprisingly affordable, and they offer a number of benefits. Here we look at the various aspects and costs of affordable renters insurance.

One Renter’s Insurance Policy Will Offer Similar Coverage As Another

There is a caveat to the idea that all renters insurance policies are created more or less equal. The highest-quality insurance companies generally offer similar options for their basic coverage. This does not cover other more obvious insurance company differences, like policy management ease, customer service, and price.

Besides this, every person’s own particular circumstances help them decide what company and policy is best. Examples of such unique scenarios include Americans over 50 years of age and military service people and their families. For purposes of comparison we consider coverage, policy management, and cost here.

Renters Insurance Coverage and Concepts

With the majority of renters insurance policies, they call the cause of loss “perils.” These policies generally specify precisely what you are covered against in these named peril policies.

There a number of the best-known dangers or perils that these renters insurance policies address, including the following:

• Theft
• Vandalism
• Water Damage
• Smoke
• Fire
• Lightning Strikes

This does not mean that all of these perils will be covered in every policy though. It explains why you need to carefully check that specific conditions are covered for places that suffer from extreme weather such as lightning, hurricanes or tornadoes, or fire-causing conditions.

Common Kinds of Renters Insurance Coverage

There should be four common categories of standard insurance provided by any of the top renters insurance firms. These include all of the following:

• Personal Property Coverage
• Loss of Use/Additional Living Costs
• Liability
• Medical Payments

We look at each of these next.

Personal Property Coverage

This is the coverage for daily use items. It includes appliances, clothes, and furniture. This coverage also extends to musical instruments and equipment and jewelry. Extended coverage is available for those individual pieces that are higher cost.

Generally, renters insurance protects your personal effects regardless of where the item is when something happens to it. In other words, the coverage extends beyond your personal apartment. This means that your laptop is covered against theft when you are in a restaurant. There is a difference between out of apartment storage and taking an item out of your apartment. Additional coverage becomes necessary for personal effects that you permanently store elsewhere.

Loss of Use/Additional Living Costs

This provision coverage includes supplemental costs of living if your apartment (or house) becomes so severely damaged that you become displaced on a temporary basis. Expenses covered in this category cover restaurants, hotels, and related costs. The individual policy provides time limitations on coverage access.

Liability

Liability can be critical coverage. If you are on the hook legally because of property damage or even physical injury to another person resulting from an accident or event that took place and harmed a family member or yourself, this coverage protects you. Medical expenses and treatment are a big component of this.

Medical Payments

Guests in a home who become injured there will need medical treatment, and this gets expensive fast. This coverage works regardless of your liability for the injury or accident. In the categories of medical costs and payouts are hospital visits, doctor’s expenses, and x-rays and tests. This coverage is not intended for you or your family members, only for guests and visitors.

Special Extended Coverage Options

In some special circumstances it is appropriate to consider supplemental renters insurance coverage. In the insurance industry, they call this a floater policy. If you keep an expensive stamp or coin collection or jewelry in your apartment or home (or any other highly valuable single item or collection), then this is relevant to consider. Many of the different major carriers offer extended coverage, including Nationwide, Allstate, Liberty Mutual, and other top carriers.

Renters Insurance Policy Management

The first order of business in policy management is the total amount of coverage you require. Estimating this correctly will save you potential grief if you do need to file a claim one day. While you do not want to overpay in monthly premiums for too much coverage, you also should never underestimate the replacement cost of your prized possessions should a theft or natural disaster occur.

Top insurance companies help you in determining this with a handy calculator you can utilize to properly estimate the replacement cost of your goods. Some insurance companies offer tools slightly better than their competition. As an example, Allstate provides their “What’s Your Stuff Worth?”

This online tool excels at assisting visitors in determining the valuables you have, the value they command, and the replacement cost without insurance. It operates by taking you on an imaginary walking tour of all rooms in your apartment or house. Through this process of gathering rather simple information, the Allstate app returns a fast estimate of the real value of your possessions. How often can you claim that a financial services tool is enjoyable to play around with these days?

Mobile Apps

Many of the best rated renters insurance companies will provide you with a good online feature that makes it easier to manage the policy. Allstate again excels in this department. Their app the Digital Locker allows users to catalog all personal belongings through photographs. This means that you can utilize this app via tablet, smartphone, or laptop to snap shots of all personal effects so that you can list values for them and upload pictures to your online account. In the case of this app, (as with top competitors) it works on various platforms including Android and Apple. The Digital Locker in particular helps users to do the following:

• Give precise estimates through either a bar code search or Google search
• Organize personal belongings according to category, room, or in lists
• Base listings on preset category and room templates
• Maintain an up to date inventory so that if you need to file a claim, all of your items are accounted for with pictorial documentation

Apps like this one make it so easy to manage a renters insurance policy and personal inventory.

Cost Comparisons of Renters Insurance

All of the top-rated renters insurance companies are free with their no-cost, no-obligation online quote system tools as well. This is the optimal means of quickly comparing the pricing of various rent insurance policies as it permits you to get an honest snapshot of your personal needs. In other words, it helps you to compare apples to apples as much as possible in the insurance world.

The general costs for renters insurance come down to two important factors: the size of your apartment or house along with your personal credit history. Also important to the quote results will be the location of your address since values and replacement costs range widely from one city and state to another. The good news is that for most first-time renters insurance customers, the premiums seem affordable. This is the case even for the top-ratted companies and policies.

For example, the Trusted Choice Independent Insurance Agents’ current study revealed that the typical renter pays premiums amounting to an average of $16 a month. The National Association of Insurance Commissioners experts provide guidelines of paying from $15 to $30 each month on common policies.

Comparing Three Well-Known Rental Insurance Companies Prices

It always helps to make real dollar value comparisons. To help provide clarity with tangible examples, we will look at comparable policies and the premium cost estimates for someone with good credit. In this section we will look at Nationwide, Allstate, and American Family.

These policies cover a decent amount of possessions at $30,000 in coverage at replacement cost for rentals on the outskirts of a big American city. Here are the monthly rates that they returned:

Nationwide Rates: $22.42

Allstate Rates: $17

American Family Rates: $11.50

As you can see, the price quotes are within the recommended range per month and not far from the average premium each month per renter insurance customer. By way of comparison, you are able to obtain a solid $30,000 in coverage for your prized possessions over an entire month for about the money you would have to spend on one or two large pizzas. It does not get much cheaper than this.

The most effective means of tracking down the least expensive renters insurance is to obtain several quotes from minimally two to three different renters insurance providers. Some analysts will suggest only two, but as you can see from the sample premiums above, if you had obtained only Nationwide and Allstate premium prices, you might have overpaid on the least expensive rates sampled above by at least $5.50 per month. This represents a staggering 48 percent higher monthly premium cost, all because of only getting two comparison quotes on renter’ insurance.

What Discounts Are Available for Renters Insurance?

The premiums are already low with renter’s insurance, but they can be reduced even further through relevant discounts in many cases. The most popular ones that apply to renters and their insurance needs are the following:

• No Claims Discount – for those who have never filed a claim or not filed one in years, this discount applies
• Multiple Policy Discount – if you have a health insurance, auto, or life insurance policy with the firm, they will reduce the rates for rental insurance
• Safety Devices – these discounts cover such safety devices installed at home as home alarm systems, sprinklers, or smoke detectors.

The top insurance companies will offer these discounts. There are not so many price breaks as with other types of insurance (like auto or homeowners), yet they still can add up to significant savings on already very reasonably priced premiums.

Primary Factors Determining Premium Costs for Renters Insurance

Renters insurance has something in common with home owners insurance. With both types, several different key considerations impact the price of premiums on your policy. Keep in mind the four following important factors:

• Amount of coverage – Among the top considerations for an insurance company issuing renters insurance is the so-called level of coverage. This amount is different for each person and property. Thanks to their estimate tools online, insurance companies make it easier than ever to determine how much is appropriate
• Deductible amount – The sum of money that comes out of your pocket before the insurance company pays a penny. With higher deductibles come lower premiums, and with lower deductibles come more expensive premiums as a general rule. You should never choose a higher deductible than you can reasonably hope to meet should you need to file a claim
• Location, location, location – streets or neighborhoods with a higher crime rate are going to pay more. You might mitigate the damage of this partially with alarm systems. Areas that suffer more from tornadoes, hurricanes, earthquakes, fires, and floods will also command higher monthly premiums
• Replacement cost as compared to actual cash value – Nowadays the majority of renters insurance providers will offer the choice of actual cash value or replacement cost coverage. Replacement cost is the more desirable and more expensive option, since it actually pays the often-higher price of replacing an item than it is worth once “used.” They figure this as cost of replacement less depreciation. Few people regret having paid slightly more for replacement cost coverage when they file their first claim

A Primer on What Renters Insurance Actually Covers and How It Works

The most obvious item that renters insurance will cover is your personal effects. There are several other scenarios it also takes care of in the majority of policies (in particular from highly rated insurance providers). These coverages include the following three features:

1. Your Personal Possessions

This quite simply refers to anything stored in your house or apartment. With an owned property, homeowner’s insurance would cover this. Rental properties are different and need rental insurance to get the job done. This provides you with the flexibility to take this insurance (though some landlords will require it in certain markets and buildings). You also get to decide what dollar value amount you want covered by your policy. The higher amount of coverage, the higher your premium will end up being. It is important to keep in mind that higher cost categories such as sporting equipment, jewelry, musical instruments, and collectibles (watches, coins, stamps, china)come with limits to the dollar amount actually covered. Floaters above and beyond this amount, or endorsements, can cover extra value above the standard policy limitations.

2. Additional Living Costs (or Expenses)

In the event that your apartment is completely destroyed in a hurricane, tornado, or wildfire, you lose not only your possessions but also your place to live. This will create unplanned additional costly expenses for temporary living arrangements. This is logistically difficult enough to deal with, but thanks to this coverage, you would be provided with cash for temporary rental arrangements, hotel costs, meals at restaurants, and other relevant expenses while your home is rebuilt, repaired, or you find a new place to live.

3. Medical and Legal Liability

Many people are unaware of the fact that an unforeseen incident or terrible accident at their apartment or house creates both legal and medical liability for suffering, medical costs, and more. This helpful coverage protects you from costly legal fees and high medical expenses if a person is injured while on your premises or because of your own careless or negligence. You would not intentionally leave a stove top burner going, but it could still lead to a terrible fire that causes serious injuries or seriously burns someone in your apartment (particularly small children). The majority of typical and traditional renters insurance policies cover a good $100,000 worth of liability. You can elect to buy a greater amount of it if you are accident prone.

Renter’s Insurance Premiums Are Paid On A Monthly Basis

With many forms of insurance these days, you pay the premiums on a monthly basis as the insured party. This is common with renters insurance as it is with auto, home, and health insurance coverage.

These premiums can vary, but often will amount to approximately $120 per year given $10,000 worth of personal property insurance coverage and a $100,000 coverage in liability. Companies charging this amount include the likes of household names such as State Farm, Allstate, and Liberty Mutual. The list of rental insurance companies is extensive though since practically every well-rated and nationally known insurance company will write rental insurance policies.

Is It Prudent to Obtain Renters Insurance for Your Apartment or Rental House?

Many renters have the luxury of deciding whether or not to pay for renters insurance on their rental property. Others will find the landlord mandates carrying and providing proof of this form of insurance. Yet statistics from the Insurance Information Institute reveal that approximately 31 percent of Americans renting opt for rental insurance. The fact that nearly seven out of 10 consenting adults choose not to pay for such inexpensive insurance should not sway your decision in the least. It is more important to decide if such coverage is worth the price of having the peace of mind it brings.

Is Renters Insurance Worth this Peace of Mind?

Since the cost of the typical renters insurance policy ranges from $12 to around $20 per month, it is hard to say that your peace of mind is not worth the cost. It amounts to between 40 and under 70 cents per day. For far less than a daily cup of coffee out, you can rest easy at night, knowing that your possessions are protected.

It is not merely a question of you being responsible and careful. Anyone who shares a multiple unit housing facility or apartment building is ultimately at the risk of his or her neighbor’s responsibility. Just because you could never do something to cause a building fire, does not mean that your neighbor down the hall will not.

Sitting down to figure out the cost to replace even a basic amount of furniture, clothes, and possessions will quickly show you that it is irresponsible not to carry renters insurance. Replacing everything you own can break you however much you do or do not have. It explains why you should shop around for the best possible and most affordable renters insurance policy that you can. Some great news is that he two factors of high quality and low cost are not mutually exclusive (for a change) with this very reasonable form of insurance on your personal possessions. Consider the Additional Living Expenses coverage and Liability coverage a little extra icing on the cake.

As with anything, you really need to spend the necessary time to shop quotes on renters insurance to obtain at least three separate insurance providers before you take the plunge and buy a policy. This makes great sense and is well worth the time invested as odds are you will stay for many years if not decades with your rental insurance company once you pick one. Since renters insurance is simple to obtain, really reasonable, and provides no downside, making the decision to do without it could prove the worst financial decision of your entire life.

And if you still have doubts as to whether or not you own enough to bother with the premium cost equal to a large pizza each month, the solution is obvious. Sit down and figure out everything you own, how much it would cost to replace it entirely, add up the replacement cost amount, and see what total you get. You may be surprised at the clarity doing this exercise will provide.

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