How Much Renters Insurance Do I Need?

young couple in their apartment looking for renters insurance at laptop

Updated: 09/01/2020

You moved into your first apartment and have purchased all of the necessities, such as brand new furniture, a 50-inch flat-screen TV, and a state-of-the-art computer. You may think you are set, but there could be something you are missing: renters insurance.

Apartment insurance is frequently overlooked. In fact, according to the Insurance Information Institute, nearly 95% of homeowners have homeowners insurance. In comparison, only 37% of renters have rental insurance. You may think that its an unnecessary expense, but it can be quite affordable. It will also save you a lot of money in the event of an unfortunate incident that affects your property or assets.

What Does Renters Insurance Cover?

Renters insurance typically includes three types of coverage:

  1. Personal property coverage. This coverage helps pay for losses if your property is stolen or damaged.
  2. Liability coverage. If a guest was injured in your home, this coverage would pay for medical bills and legal fees if they subsequently sue you. It would also protect you if you accidentally cause damage to someone else’s property.
  3. Additional living expenses. This coverage applies if you can no longer live in the apartment or home you are renting because of an emergency like a fire or flood. Additional living expenses coverage will help pay for your hotel bill or extra money that you spend on necessities such as food due to the situation.

How Do I Determine How Much Apartment Renters Insurance I Need?

Like any other insurance policy, renters insurance has a coverage limit: the total amount your insurance company will pay in the event of a covered claim. Understanding the amount of coverage you need can take some time, but is worth the effort. You want to ensure you are fully protected and not overpaying for coverage you don’t need. There is a different process for determining how much personal property coverage you need and how much liability insurance you need.

  • Personal property coverage. Begin by conducting a home inventory. Make a list of everything you own and include details like how long you’ve had them, what you originally spent, and what they are worth now. Receipts and photos can be an asset in the event of a claim if your property gets stolen or destroyed.
  • For liability coverage. Consider all of your assets and keep in mind the high costs that come with medical bills and legal fees in an incident. A standard renters policy offers about $100,000 in liability coverage, but you may want to consider quotes for increased limits.

What Isn’t Covered by a Standard Renters Insurance Policy?

When it comes to expensive items such as art or jewelry, many renters insurance policies have sub-limits on what they will pay for an individual item. Sub-limits typically range from $2,500 to $5,000. Suppose you have any expensive items, such as a $7,000 engagement ring. In that case, you may want to add supplement coverage for that particular item as you won’t be fully protected for that specific item.

How Do You Determine the Best Renters Insurance for You?

Once you have determined the coverage limits, get renters insurance quotes from different companies. One major thing to be mindful of as you compare renters insurance policies is whether they will reimburse you for replacement or fair market value. Replacement value policies will pay for you to replace your items with new ones. Fair market value policies consider the current worth of your existing property.

How Much Does Renters Insurance Cost?

It is certainly possible to find a cheap renters insurance policy. According to Business Insider, a renter insurance policy can cost as little as $15 per month or $180 per year. This amount seems nominal compared to the amount you would have to spend to replace all of your apartment’s belongings!

If you’re ready to purchase renters insurance in California, Cost-U-Less can help. Start your free renters insurance quote online, over the phone, or at one of our offices near you. We compare rates from top insurance companies to ensure you get the best coverage and lowest price.