Is Renters Insurance Worth Getting?

Even if your landlord doesn’t require it, renters insurance is an affordable way to protect yourself from unexpected costs, like property damage or legal issues.
 

What Is Renters Insurance?

Renters insurance is a type of insurance that protects you in several ways. If your belongings are stolen or damaged, or if you accidentally cause harm to someone or their property, renters insurance can help pay the expenses.

It can also help pay for a place to stay and other living costs if your rental unit becomes unlivable due to a covered event, like a fire.

As of 2022, about 49% of renters had renters insurance. For more than half of them, it was a requirement set by their landlord.
 

How Much Does Renters Insurance Cost?

Renters insurance is usually quite affordable. You can adjust your policy to match your needs and budget by picking how much coverage you want, your deductible (what you pay before the insurance covers the rest), and any extra options for special items.

For example, in 2020, the average monthly cost was $21.33 in Mississippi (the highest) and $12.80 in Oregon (the lowest), according to the Insurance Information Institute.
 

What Does Renters Insurance Cover?

Typical renters insurance policies include:
 

• Personal Belongings: If your things (like furniture, electronics, or clothing) are stolen or damaged by certain events (such as fire or vandalism), insurance can help cover the cost to repair or replace them.
• Liability Protection: If someone is hurt in your home, or if you accidentally damage someone else’s property, insurance can help pay for medical bills, legal fees, or settlements.
• Additional Living Expenses: If your home is damaged and you can’t live there while it’s being fixed, insurance can cover the cost of a hotel and meals.
• Medical Payments: If a guest is injured in your rental home, insurance can pay for their medical bills, even if it wasn’t your fault.

 

What Isn’t Covered by Renters Insurance?

Renters insurance doesn’t cover everything. Some common exclusions are:
 

• Flood and Earthquake Damage: Most policies don’t cover these events unless you buy extra coverage.
• Certain Natural Disasters: Insurance usually covers fire or windstorm, but you should check your policy for other disasters.
• Intentional Damage: If you intentionally cause harm or damage, it’s not covered.
• Business Activities: Running a business from your rental unit usually isn’t covered.
• Pets: Some policies don’t cover damages or injuries caused by certain pets or dog breeds. Always review your policy if you have pets.

 

Why Is Renters Insurance Important?

Unless you have a lot of money saved, renters insurance can help protect you financially. If you lose possessions like electronics, clothes, or jewelry, the policy can help you replace them.

It also shields you from big bills if someone is hurt in your home or you accidentally cause damage.
 

How Much Coverage Do You Need?

How much insurance you need depends on how much your belongings are worth, your risk level, and your comfort. Consider the following:
 

• Take Inventory: List your belongings and estimate their value to know how much coverage you need.
• Assess Your Risks: Think about possible legal and medical expenses if someone is hurt or their property is damaged.
• Check Living Expenses: Consider how much it would cost to live elsewhere if you can’t stay in your rental.
• Decide on a Deductible: A higher deductible lowers your monthly cost but means you’ll pay more out of pocket if you make a claim.

Insurance policies have limits and exclusions, so read yours carefully. If you have valuables like jewelry or collectibles, you may need extra coverage.
 

In summary

Renters insurance is a low-cost way to protect yourself from unexpected expenses from damage, theft, or liability claims.

Carefully review your policy to understand what’s included and talk to your insurance provider if you have unique needs.

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