When renting a home or apartment, a renter might assume that their landlord will step in to pay for repairs or replacement if the property is damaged. To a certain extent, that is true: a landlord is responsible for repairing damage to the structure of the building caused by a covered event—but that coverage doesn’t apply to a renter’s personal possessions. For instance, if a tenant’s clothes are damaged by fire, or someone breaks in and steals their electronics or jewelry, it’s up to the renter to replace those items, not the landlord. Renters insurance provides coverage to help tenants do just that.
But exactly what is renters insurance? This type of coverage—sometimes referred to as apartment insurance, although it can apply to other kinds of rental properties, too—can help tenants cover the cost of replacing their personal possessions if they are stolen or damaged by a covered event, which can include fire, smoke, wind, hail, and some forms of water damage. However, renters insurance coverage doesn’t end there. If an apartment is damaged by fire and the tenant needs to temporarily stay in a hotel while repairs are made, renters insurance can assist with the additional funds needed to cover those costs, above and beyond the renter’s normal cost of living. If a guest trips in the apartment and breaks their arm, renters liability insurance can help cover their medical costs. Having renters insurance can be very useful, as it helps to protect renters’ belongings and financial assets. It is also a relatively affordable type of coverage. As such, renters may want to think ahead about their insurance needs when they are combing through the best rental listing sites and searching for a new home or apartment. It’s important that they find the best renters insurance company to provide the coverage they need at a price they can afford. This curated list provides a good starting point for renters looking for the best coverage for their needs.
- BEST OVERALL: State Farm
- RUNNER-UP: American Family Insurance
- BEST FOR BUNDLING: Nationwide
- BEST DIGITAL EXPERIENCE: Lemonade
- BEST FOR MILITARY MEMBERS: USAA
What to Consider When Choosing One of the Best Renters Insurance Companies
While price is an obvious consideration when a renter is looking into how to get renters insurance, it’s also essential for them to weigh a company’s coverage options, claims process, and customer service ratings. In particular, it’s important for potential customers to look at the coverage limits, coverage area, and discounts for each insurance provider because these individual factors can affect the price the most.
Renters insurance may not be available from all insurance companies in all states, and availability may even be limited by ZIP code. When shopping for the best renters insurance, renters will want to begin by finding out whether their location is included in the renters insurance company’s coverage area. If not, they can quickly move on to the next company. This will save potential customers a lot of time and hassle when searching for a home renters insurance policy. In addition, some coverage options may not be available in every state, even if the insurance company provides renters insurance nationwide. Renters will want to check that any coverage they absolutely need is available in their exact location before proceeding with their chosen insurer.
All renters insurance policies have maximum limits for personal belongings, liability coverage, expense reimbursements, and other types of coverage. Therefore, when comparing different policies, renters will want to look at the coverage limits offered by each provider to see if those amounts are high enough to pay the full replacement cost of any damaged or stolen possessions. Although policies may cost the same in some instances, a renter may find that one policy has lower coverage limits, which could limit the size of a payout after they’ve filed a claim. Renters want to get the most value from their insurance while minimizing their own out-of-pocket costs, so it’s important for them to weigh these coverage limits when comparing the best renters insurance policies to get the appropriate amount of renters insurance coverage.
Additional Policies and Add-Ons
When shopping for renters insurance, a renter may see options for specialty coverage for jewelry or collectibles in addition to identity theft protection or even pet protection. These coverage options are not all the same. For example, coverage specifically for jewelry typically requires an additional stand-alone policy separate from renters insurance coverage. That means it may have its own premium, deductible (the amount a policyholder pays out of pocket before a claim is paid), and coverage limits. However, adding coverage for identity theft or damage caused by pets is more likely to be an option a policyholder can add to an existing renters insurance plan. Even so, add-on options will likely vary by insurance company, so renters may want to check that any extra coverage they want to purchase is available.
Insurance companies can offer various ways for potential customers to get renters insurance quotes. Some require a renter to contact a local agent by phone or in person to provide personal information so they can receive a tailored quote. Some insurance companies offer an online quote process to give renters a general idea of cost, and some companies offer both methods. When shopping for the best renters insurance, finding companies that provide a convenient quote process can also help renters more easily compare renters insurance rates and policy options so they find the right provider and plan to suit their needs.
When shopping for the best renters insurance, renters will want to look into the claims process. They’ll want to find out whether they can they file a claim online using the insurance company’s site or mobile app, whether they will need to see an agent or wait for an insurance adjuster to evaluate the situation, and how long will it take for the insurance company to approve and pay out a claim following a covered event. When it comes to replacing clothing, electronics, or other belongings, renters likely won’t want a long, drawn-out claims process when they need those funds as soon as possible to help them replace what was lost.
To help save on insurance for renting a home or apartment, customers will want to ask insurers about any renters insurance discounts offered. For instance, customers may receive a lower rate for bundling renters insurance with a car insurance policy. Other possible cost-saving opportunities could include loyalty discounts, discounts for installing protective devices such as smoke detectors or alarm systems, paperless billing discounts, or automatic payment discounts. The availability and amount of discounts will vary from company to company, so it’s important that renters take them into consideration when comparing insurance rates. The right combination of discounts and savings could turn what would otherwise be a pricey policy into a relatively cheap renters insurance plan.
Actual Cash Value vs. Replacement Cost Coverage
A key factor for renters to review and compare when shopping for insurance is the payout method. Renters insurance policies typically pay out a claim amount based on either the replacement cost value or the actual cash value of the covered items. The replacement cost value is the amount it will cost a renter to buy a new item in like condition to the one that was lost, while the actual cash value refers to the depreciated value of the item at the time of the claim. Actual cash value could mean that a policyholder winds up receiving a lower payout than they need to replace the covered item at current prices.
Replacement cost coverage typically costs more per month than actual cash value coverage because payouts tend to be larger. Not all renters insurance providers offer replacement cost coverage, either, which can impact a tenant’s decision when choosing the right renters insurance policy for them.
AM Best Rating
As renters shop around for the best renters insurance, they may notice that many companies mention their AM Best rating. AM Best is a credit-rating agency that is widely recognized as a credible source for evaluating the financial strength of insurance companies. An insurance company’s financial strength is an important indicator of the company’s ability to pay out claims to its customers. AM Best insurance ratings fall between A++ (“Superior”) and D (“Poor”). Some ratings may include extra plus marks that may separate them from competitors. However, a rating of B+ (“Good”) or higher is a good indication the insurance company will likely be a solid choice for renters insurance.
Reviewing customer complaints about a renters insurance company can provide renters with insight into how well it treats its customers and pays out claims. There are two critical resources for this information. The first is the National Association of Insurance Commissioners, which maintains a database of complaints about insurance companies. Renters simply need to enter the insurance company’s information on the Consumer Insurance Search page, choose “Click for Report Options,” and then ”Go to Complaint Trend Report.” They can also check to see the company’s J.D. Power ranking. J.D. Power analyzes a variety of consumer data to determine a company’s customer satisfaction ranking.
Our Top Picks
The best renters insurance companies focus on providing a range of coverage options at an affordable price while also making it easy for customers to purchase. The following companies checked all these boxes, and more, making them among the best renters insurance picks out there.
Why It Made the Cut: State Farm’s nationwide availability, multiple ways of getting a quote, strong financial strength, high customer satisfaction ratings, and affordable price all contribute to its top spot.
State Farm offers a great combination of benefits that many renters would want out of their insurance. Renters across the country can get a quote online, by phone, or by talking to a local agent. Rates are typically lower than those of competitors and the national average cost for renters insurance. And if the renter already uses State Farm for their auto, life, umbrella, or other insurance needs, they can bundle their renters insurance with those policies for additional savings. Some discounts may vary by state and not apply to all renters, but State Farm’s already low prices mean renters don’t necessarily need to rely on discounts to get a low rate.
Given that State Farm has an AM Best rating of A++, a report for excellent customer satisfaction per the National Association of Insurance Commissioners, and a seamless web experience, users can feel confident their renters insurance claim will be handled correctly and promptly should they need to file one.
- Coverage area: 50 states and Washington, D.C.
- Additional policies: Vehicle, life, health, small business, pet, umbrella
- Quote process: Online, phone, agent
- Claims process: App, online, phone, agent
- AM Best rating: A++
- Sample monthly cost: $11.08
- Relatively low monthly costs
- Excellent customer satisfaction
- A++ AM Best rating
- User-friendly website
- Limited discount opportunities
Why It Made the Cut: American Family Insurance has a diminishing deductible that goes down for every year the renter renews their policy, making it an excellent choice for long-term renters.
American Family Insurance offers discounts up to 15 percent for bundling, making renters insurance more affordable for eligible policyholders. Tenants may also save on their out-of-pocket expenses by taking advantage of AmFam’s diminishing deductible. For every year a renter renews their policy, the deductible will go down, and policyholders can reduce their deductible by as much as $500 with this program.
It should be noted that AmFam’s renters insurance policies are only available in 19 states, and policyholders may find that their monthly rates can be somewhat high in some cases. That being said, renters may be able to reduce the cost of coverage by applying discounts for having a smart-home security device. Renters can also submit a claim 24/7 online or by phone, which can speed up the claims process so policyholders can receive their payout without delay.
- Coverage area: 19 states
- Additional policies: Vehicle, life, business, umbrella, travel
- Quote process: Online, phone, agent
- Claims process: Online, app, phone, agent
- AM Best rating: A
- Sample monthly cost: $30.33
- Diminishing deductible reduces every year the policy is renewed
- 24/7 claims support
- Discounts for customers with a qualifying smart-home security device
- Up to 15 percent discount for bundling policies
- Limited coverage area spanning 19 states
- Monthly costs can be relatively high
Why It Made the Cut: Nationwide offers a variety of add-ons so renters can get the full amount of coverage they need, all of which can be bundled with other insurance coverage.
If a renter already has car, life, travel, pet, or other insurance coverage with Nationwide, they’ll find it easy to bundle their renters insurance policy with their existing policies, which will provide additional savings. Renters also have the option to purchase additional coverage for valuables such as jewelry and sports equipment, as well as coverage for belongings in storage and for damage due to backed-up sewers or drains.
The online quote process is straightforward and more thorough than that of other companies, meaning that renters are more likely to get the coverage they really need. Renters can file claims online or over the phone; Nationwide does have an app, but the app is mainly geared toward auto insurance services. J.D. Power’s customer satisfaction ranking for Nationwide is also somewhat low, but one standout feature Nationwide offers is the On Your Side review. This free service lets customers review their policies annually with an agent to ensure that their coverage is complete and they’re getting the best possible price and not paying for unneeded features.
- Coverage area: 50 states and Washington, D.C.
- Additional policies: Vehicle, life, pet, travel, dental, accident, identity theft, umbrella, wedding
- Quote process: Online, phone, agent
- Claims process: Online, phone, agent
- AM Best rating: A+
- Sample monthly cost: $18.64
- Renters can bundle multiple policies and add on additional coverage
- On Your Side review allows customers to annually review and reassess policies with an agent
- Online quote process is thorough and straightforward
- Mobile app is geared toward auto insurance and is not as helpful for filing or tracking claims for renters insurance
- Overall customer satisfaction is lower than for other companies, according to J.D. Power
Why It Made the Cut: As an all-online insurance company, Lemonade is ideal for consumers who prefer to handle all their renters insurance needs online.
Lemonade makes it quick and easy to get renters insurance online or through its app. Users could receive coverage in 90 seconds and, if a renter files a claim, Lemonade says the claim could be approved within seconds. If a renter appreciates doing business with socially conscious companies, Lemonade is a certified B Corp, which means it has high social and environmental standards. One example of this commitment is that Lemonade donates unclaimed money from paid premiums to the charity of each customer’s choice, so renters can feel good about their unused funds benefiting causes that are close to their hearts.
There’s no option for getting a quote or filing a claim over the phone, but this shouldn’t be a hindrance for customers who prefer online-only interactions. That’s especially true given how easy it is for users to get a quote through the company’s streamlined online quote process. Lemonade’s monthly costs can also be relatively high, depending on the coverage options selected, and the company’s coverage area is somewhat limited. That being said, customers automatically receive replacement cost coverage on any policy they purchase, which can lead to a larger payout when the time comes to file a claim.
- Coverage area: 28 states and Washington, D.C.
- Additional policies: Auto, pet, life
- Quote process: Online
- Claims process: Online
- AM Best rating: Unknown
- Sample monthly cost: $13.67
- Certified B Corp company with high social and environmental standards
- Leftover money from customers’ premiums is donated to the nonprofit of the customer’s choice
- Fast and convenient online quote process
- Instant claim approval possible
- Customers receive replacement cost coverage
- Relatively small service area covering 28 states and Washington, D.C.
- Quote and claim system are only available online
- Monthly costs can be relatively high for high coverage limits and add-ons
Why It Made the Cut: USAA offers affordable insurance with low prices and great coverage for members of the military.
Available nationwide to eligible renters, USAA has a strong reputation for renters insurance rates that typically are less than the national average. It’s also known for excellent customer service and strong financial backing, which is reflected in the company’s A++ AM Best rating. Although renters can start the quote process online, they may need to call the company to get a final quote. However, speaking directly with an agent could help prospective customers get a more accurate estimate for the coverage they want.
Renters insurance through USAA also includes flood and earthquake damage coverage, which is usually treated as an add-on by other insurance companies, potentially helping policyholders save money if they require that extra coverage. While USAA renters insurance is only available to current or former military members and their families, it’s a great option for renters who are eligible because of its competitive rates, strong financial standing, and extensive coverage options.
- Coverage area: 50 states and Washington, D.C.
- Additional policies: Vehicle, life, health, pet, travel, dental, small business, umbrella
- Quote process: Online, app, phone
- Claims process: Online, app
- AM Best rating: A++
- Sample monthly cost: $8.89
- Low renters insurance premiums
- A++ AM Best rating
- Standard flood and earthquake coverage included
- USAA membership limited to service members and families
- Limited online quote tool
State Farm earned the Best Overall rating on our list because it checks all the boxes for affordability, coverage options, and customer service. American Family Insurance was the Runner-Up because of the diminishing deductible on renters insurance policies.
How We Chose the Best Renters Insurance Companies
To select the best renters insurance companies, we reviewed the various coverage options for renters insurance from different companies and looked at possible rates to see which companies had the most affordable policies. In addition, we looked at the AM Best ratings and J.D. Power rankings of each company to see how they stacked up based on their ability to pay claims and their level of customer service. We also looked at the geographic availability of these renters insurance companies and their policies for customers across the country. These factors all played a role in determining the best renters insurance companies to include in this guide.
Before You Choose One of the Best Renters Insurance Companies
According to Dave Phillips, spokesperson for State Farm, “[A] renters policy is more important, accessible, and affordable than you might think; and, in some cases, renters insurance is required by landlords. But renters are often unclear about what renters insurance is, what it covers, and how much they need.” In order to answer those questions, Phillips advises that the renter speak to their current insurance agent. “Talking with an agent is the best way to find out what you’ll need to do to get new insurance or transfer your insurance to your new address,” he explains. “Your agent will also help you understand insurance requirements in your new location.”
Not every company will fit the needs and budget of every consumer. It’s vital for customers to compare renters insurance policies with a close look at the coverage options, coverage limits, rates, and deductibles. Renters will also need to evaluate whether they want the ease of purchasing and maintaining the renters insurance policy online or if they prefer to deal with an agent, either by phone or in person. Reading renters insurance reviews can also help renters determine whether there are any consistent issues with the company’s user interface or customer service that they need to know about. A renters insurance comparison will help narrow down the choices for the best renters insurance companies.
Tenants will want to be aware of what exactly a renters insurance policy will cover when deciding if this type of insurance is worth the expense. Landlord insurance will cover damage to the building itself as well as any appliances included with the unit. The property owner may also have a home warranty for the rental property to pay for repairs to appliances and home systems as a result of wear and tear.
Cost of Buying a Policy From One of the Best Renters Insurance Companies
Budget-conscious tenants may wonder, “How much is renters insurance?” The national average cost of renters insurance is $174 a year, or $14.50 a month. But where a renter lives will play a significant role in how much renters insurance will run. For example, in Louisiana, the average yearly cost is $236, while the average annual price in Wyoming is only $147. Renters insurance costs can also vary within the same state; for example, coverage in New York City is likely to be more expensive than coverage in a smaller city or town in New York such as Syracuse or Buffalo. Other factors affecting the cost include the renter’s credit history, the type of building they live in, the type and amount of coverage they choose, their deductible, and their insurance claims history.
Customers will want to get estimates from at least three different companies as they shop for the best renters insurance. When gathering renters insurance quotes, it’s important for renters to compare the details of each policy, including the coverage limits and the costs. Renters will want to make sure the specifics of the policies are the same to verify which one is the least expensive while providing the same coverage. In addition, it’s important for renters to look at all available discounts when comparing renters insurance, because those discounts could make an already great policy more affordable than it otherwise would be. They’ll also want to remember that any add-on coverage will increase policy rates.
Advantages of Buying a Policy With One of the Best Renters Insurance Companies
Renters insurance is usually worth it for tenants because landlords are not responsible for any damage to or loss of a renter’s personal belongings inside the apartment or home. Renters insurance will provide coverage for clothing, furnishings, electronics, household goods, and other belongings in the apartment or home. Coverage can even extend to a tenant’s personal possessions when they are outside of their home in some cases—items in storage, for instance. The best renters insurance can also provide liability coverage (which may cover the renter if they’re facing a claim or lawsuit for property damage or injury) as well as funds for temporary housing if the property is uninhabitable following a catastrophic event.
- Renters insurance may help pay for medical expenses if a third party is injured in a tenant’s home.
- If a tenant accidentally damages a neighbor’s apartment wall (say a shelf falls and leaves a hole), renters insurance would likely cover repairs.
- Renters insurance may provide coverage if the policyholder is a victim of identity theft.
Shopping for the best insurance for renters can be confusing, but it’s important for renters to research different companies so they can find the best coverage for their needs and at the best price for their budget. It’s a worthy investment that will protect a tenant’s belongings if a covered event causes damage to them.
Q. What does renters insurance typically cover?
Renters insurance typically covers a renter’s personal belongings for covered events (less the deductible). It also provides liability protection if they are found legally responsible for causing damage to someone’s property or injuring them, medical payments if someone is accidentally injured in the rental property, and reimbursements for temporary living expenses if their home is uninhabitable following a covered event.
Q. Can a landlord require renters insurance?
Yes, landlords can include language in their leases stating that renters insurance is required for all tenants. By doing so, property owners may be able to minimize the risk of liability claims that would not be covered by their landlord insurance policy. Even if a landlord doesn’t require renters to purchase insurance, it may be worthwhile for them to buy a policy to protect their personal belongings in case they are damaged or stolen.
Q. How much renters insurance do I need?
Whether shopping for renters insurance for apartments or single-family houses, tenants will want to get enough renters insurance coverage to pay for the cost to replace their personal belongings if they are damaged or destroyed by a covered peril. Renters will also want to check that coverage limits are sufficient to protect their financial assets in the event they are found liable for damage or injury to others.
Q. Does renters insurance cover flooding?
Most renters insurance policies do not include flooding as a standard form of coverage. Renters insurance often does cover water damage caused by burst pipes, sudden and accidental leaks, and accidental overflows. If tenants want to be protected in the event their unit floods—if they rent a garden apartment, for example—then it may be worth checking with the National Flood Insurance Program to see what options are available. This government program allows renters and homeowners to purchase flood coverage as a separate policy they will pay for along with the renters insurance or homeowners insurance cost.
Q. Does renters insurance cover theft-related damage?
Yes, renters insurance typically covers theft. In some cases, that coverage may extend outside of the rental property. If a policyholder’s laptop is stolen from a hotel room while they’re on vacation, renters insurance may help pay to replace it (less the deductible). Similarly, renters insurance may cover storage units and their contents if they are stolen. Renters will want to check the exact terms of their policy’s theft coverage, however, as some policies may exclude instances of theft that resulted from the policyholder’s own negligence. For example, insurance companies may deny a theft claim if the renter left the front door open and inadvertently allowed a burglar to enter the unit.
Q. Does renters insurance cover property damage?
In most cases, renters insurance does not cover property damage. If the structure of the building is damaged, for instance, then the property owner’s landlord insurance will likely cover it. Personal liability coverage included in a renters insurance policy may help pay for damages caused by the policyholder, though. It’s always a good idea for renters to check the exact terms of a policy so they know what their coverage includes.
Q. Does renters insurance cover carpet damage?
Renters insurance is primarily for tenants’ personal belongings. If the damaged carpet is part of the rented unit and belongs to the landlord, then the most likely scenario would be that a portion of the security deposit is withheld by the landlord. However, if the tenant purchased and installed the carpet themselves, then any damage could be covered by renters insurance depending on the source of the damage. For example, renters insurance most likely won’t cover wear and tear, but it might cover damage caused by a fire or flooding from a burst pipe.
Q. Does renters insurance cover broken windows or glass doors?
Windows and glass doors are usually considered the landlord’s property, so it would be the landlord’s responsibility to repair or replace those items. That being said, if the policyholder were to break a window in a common area or another unit, then the personal liability coverage may help pay for any damages.
Q. Does renters insurance cover bed bugs?
Generally speaking, renters insurance does not cover bed bugs—or any pest infestations, for that matter. Renters insurance is typically meant to protect against accidental and unavoidable damages, but insurance companies often consider bed bug infestations to be preventable if policyholders do their due diligence. However, the responsibility to cover the cost of bed bug removal may fall to a tenant’s landlord—renters can check their lease and local ordinances to see if this would be the case.
Q. What is not included in renters insurance?
Renters insurance usually doesn’t cover the structure of the building itself—that’s what landlord insurance is for. It typically won’t cover high-value items such as jewelry or artwork, damage intentionally caused by the policyholder, and damage or loss resulting from certain disasters such as flooding or an earthquake. Possessions belonging to other tenants who live in the unit won’t be covered under the policyholder’s renters insurance, either. Tenants may be able to purchase additional coverage to include some of these exclusions. In addition, renters insurance doesn’t typically cover earthquake damage, but a policyholder can look into taking out a standalone policy or adding an earthquake endorsement to their renters policy if they live in an earthquake-prone area.
Sources: Insurance Information Institute