As a renter, you’re not responsible for the insurance on your home or apartment’s physical structure — that’s the landlord’s job. However, your landlord isn’t in charge of protecting your personal belongings from damage or theft.
The best renters insurance can help you cover your costs in the event the unexpected happens.
Why do I need renters insurance?
Some landlords require you to purchase renters insurance. Before you can move into a rented home or apartment, you might need to show proof of insurance.
But even if your landlord doesn’t require it, purchasing renters insurance is still a smart move. Think about it: How many stolen or damaged items could you afford to replace?
Big ticket items like laptops, smartphones, TVs, and furniture would be difficult to replace on their own. But if you lost them all in a fire, for example, you might have to live without them or go into debt to replace them.
In exchange for a small monthly fee, a renters insurance policy can replace your belongings if they’re lost due to theft or disaster.
What to look for in renters insurance
No matter what policy you settle on, be sure that your renters insurance covers the following:
1. Replacement cost of items
Check to see that your apartment insurance policy covers the replacement cost of your items, instead of the cash value.
Many items, such as electronics, decrease in value over time. With cash value coverage, your insurance will only refund you for what the lost item is worth now. That likely won’t be enough to replace that computer you lost to a fire or the TV stolen from your living room.
Instead, look for replacement cost coverage. “I learned from being burglarized while living in Philly to actually read [my] policy and know what is covered before an event happens,” said Jessica Garbarino, founder of Every Single Dollar.
Garbarino had gold jewelry, a digital camera, and some CDs stolen from her rental. Luckily, she had coverage that covered the cost of replacements. “They covered all of it,” she said.
Replacement cost ensures you can recreate your home after a disaster without breaking the bank.
2. Theft or damage to your car
If your car is stolen or broken into, personal property isn’t covered by your auto insurance.
Instead, homeowners or apartment renters insurance covers it. Before you sign on the dotted line of your renters insurance policy, double-check to ensure that personal items stolen out of your car or damaged in a crash are covered.
3. Temporary housing
What happens if disaster strikes and your rental is uninhabitable? The best renters insurance policies will cover the costs of living off-site until the rental can be lived in again.
Attorney Rebecca Green Neale said that landlords should technically pay for your temporary costs in these scenarios, but many refuse.
What your landlord is required to do is dependent on state law, said Neale. In some cases, it’s about paying the difference. “Say your rent is $1,000 a month but you can’t find anything comparable for less than $1,200,” she explained. “The landlord should pay the difference.”
Getting that money could be problematic, however, or there might be an escape rule in your state. Neale recommended making sure your renters insurance covers those costs so you know you’ll get what you need in a pinch.
4. Liability coverage
Liability coverage is a vital aspect to any apartment renters insurance. This type of coverage can protect you in two ways.
If you cause serious damage to your rental unit, you’re responsible for the cost. The same is true if your guests, children, or pets cause damage. If you accidentally start a fire in the kitchen, for example, a liability policy can cover the repair costs that you would otherwise be responsible for.
Secondly, you are protected if others are hurt on the property. If someone trips down your stairs and decides to sue you, liability coverage could help over lawyer fees and settlement costs.
5. Flood and earthquake damage
Check your renters policy closely for this type of coverage; there’s a good chance that floods and earthquakes aren’t included in your policy.
For the best renters insurance coverage, be sure to add protection for these events. This can impact your monthly costs, however, so consider the added expense and weigh it against the probability of these types of disasters.
6. Discounts for security features
You might be able to get discounts for safety features on your rental property. This could cut the cost of renters insurance significantly over time.
If you have smoke alarms, security systems, fire extinguishers, and fire sprinklers, make sure you mention it to your insurance agent. Even deadbolts on exterior doors can provide you with a discount on your renters insurance policy.
How much does renters insurance cost?
Even the best renters insurance isn’t very expensive. On average, renters insurance costs about $20 per month.
But with some smart shopping, you can get a discount. Check with your auto insurance company to see if a multi-policy discount is available. My own multi-policy results in a $12 monthly premium that offers plenty of coverage.
Get the best renters insurance policy
What you need in a renters insurance policy depends on your situation. Take an inventory of your belongings and think about what will protect you best.
Even though your landlord has insurance, it’s designed to protect them — not you. Put your own protections in place with a good renters insurance policy.
Interested in a personal loan?Here are the top personal loan lenders of 2018!
|Lender||APR Range||Loan Amount|
|1 Includes AutoPay discount. Important Disclosures for SoFi.
2 Includes AutoPay discount. Important Disclosures for Payoff.
3 Important Disclosures for FreedomPlus.
4 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
5 Important Disclosures for LendingPoint.
6 Important Disclosures for LendingClub.
All loans made by WebBank, Member FDIC. Your actual rate depends upon credit score, loan amount, loan term, and credit usage & history. The APR ranges from 6.16% to 35.89%. For example, you could receive a loan of $6,000 with an interest rate of 7.99% and a 5.00% origination fee of $300 for an APR of 11.51%. In this example, you will receive $5,700 and will make 36 monthly payments of $187.99. The total amount repayable will be $6,767.64. Your APR will be determined based on your credit at time of application. The origination fee ranges from 1% to 6% and the average origination fee is 5.49% as of Q1 2017. There is no down payment and there is never a prepayment penalty. Closing of your loan is contingent upon your agreement of all the required agreements and disclosures on the www.lendingclub.com website. All loans via LendingClub have a minimum repayment term of 36 months or longer.
7 Important Disclosures for Earnest.
8 Important Disclosures for Avant.
* The actual rate and loan amount that a customer qualifies for may vary based on credit determination and other factors. Funds are generally deposited via ACH for delivery next business day if approved by 4:30pm CT Monday-Friday. Avant branded credit products are issued by WebBank, member FDIC.
** Example: A $5,700 loan with an administration fee of 4.75% and an amount financed of $5,429.25, repayable in 36 monthly installments, would have an APR of 29.95% and monthly payments of $230.33
* Important Disclosures for Upgrade Bank.
Upgrade Bank Disclosures
** Accept your loan offer and your funds will be sent to your bank via ACH within one (1) business day of clearing necessary verifications. Availability of the funds is dependent on how quickly your bank processes this transaction. From the time of approval, funds should be available within four (4) business days.
|7.73% – 29.99%||$1,000 - $50,000||Visit Upstart|
|5.81% – 15.37%1||$5,000 - $100,000||Visit SoFi|
|6.87% – 35.97%*||$1,000 - $50,000||Visit Upgrade|
|8.00% – 25.00%2||$5,000 - $35,000||Visit Payoff|
|4.99% – 29.99%3||$10,000 - $35,000||Visit FreedomPlus|
|5.99% – 18.99%4||$5,000 - $50,000||Visit Citizens|
|15.49% – 34.49%5||$2,000 - $25,000||Visit LendingPoint|
|6.16% – 35.89%6||$1,000 - $40,000||Visit LendingClub|
|5.49% – 18.24%7||$5,000 - $75,000||Visit Earnest|
|9.95% – 35.99%8||$2,000 - $35,000||Visit Avant|