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How to Find Cheap Renters Insurance: What You Need to Know

Renters insurance can help protect you in case of fire or other disaster at your apartment. But it doesn’t have to break your wallet

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Renters insurance can be a good financial move—its cost can equal as little as a few trips to your local coffee shop each month. That’s not much to pay to have your belongings replaced if there’s a fire or other disaster. A standard renters insurance policy also provides liability insurance and loss of use coverage if you can’t live in your apartment. Still, no one wants to overpay. Here’s how to find cheap renters insurance.

Related: Get renters insurance coverage in 90 seconds with Lemonade

Determine How Much Renters Insurance You Need

The first step to getting the best rates is to determine how much coverage you need so you can shop for a policy with sufficient protection but not overinsure. To do that, you want to understand how your policy works.

Renters insurance has four main components:

  • Personal property coverage reimburses you up to your policy limits if your possessions are damaged, stolen or vandalized.
  • Liability insurance pays if you’re sued for injuries or property damage you accidentally caused to someone else, and also pays for your legal defense.
  • Additional living expenses coverage pays for hotels, meals and other expenses incurred if you have to temporarily live somewhere else because your home is uninhabitable due to a covered event, such as a fire.
  • Medical payments to others coverage can cover small injuries to others, such as a guest who falls in your apartment, regardless of who was to blame.

To help you determine your renters insurance needs, here are a few tips to follow:

1. Take An Inventory of Your Belongings

What happens if your rental goes up in flames with all of your belongings inside? While your landlord’s insurance will cover the property’s structure, the personal property coverage in renters insurance can help replace all of your stuff. Conversely, not having renters insurance leaves you financially vulnerable to these types of disasters.

“You first must decide what it is you want to protect and what is the value of all items involved. Then you can find an insurance company that can provide the coverage you need for a price that fits within your budget,” says Stephanie Lloyd, president of Toggle Insurance, a Farmers Insurance company.

Making a list of every item you own and its estimated value can help you calculate the right amount of personal property coverage you need. Having a complete inventory can also help during the claims process.

Many insurance companies offer apps or inventory checklists to assist you when documenting what you own, such as the home inventory app from the National Association of Insurance Commissioners.

2. Identify Items With High Values

Consider buying additional coverage, called a rider or “scheduling” personal property, for expensive Items such as jewelry, antiques, musical instruments or artwork. Your policy only pays out up to the limit you choose, which may not be enough if you have a lot of valuable possessions. By using a rider to cover expensive items, you can then use your personal property insurance limit for everything else, like furniture and clothes.

Related: Get renters insurance coverage in 90 seconds with Lemonade

3. Protect Your Wealth

If someone is accidentally injured or there is property damage, and you’re legally liable, liability coverage is a financial safety net. It can pay for settlements and legal judgments against you. It also pays for legal fees if you face a lawsuit that’s covered by your policy. It’s wise to buy enough coverage to protect your financial assets— bank accounts, investments, vehicles—so you don’t lose them if someone brings a big lawsuit against you.

“Purchasing the right amount of coverage can give you peace of mind. Plus, often consumers are surprised by how affordable increasing your coverage by an incremental amount can be,” says Lloyd at Toggle.

Compare Renters Insurance Quotes

After estimating the total coverage amount you need, compare quotes from multiple insurance companies. Shopping around allows you to see who offers the most affordable coverage.

Related: Best renters insurance

Renters insurance quotes are free and easy to get. Or an independent insurance agent can give you quotes from multiple companies.

Also, you may want to consider insurance costs before you sign an apartment lease. Lloyd says that a rental’s location plays a significant role in renters insurance costs because of different weather-related and building-related risks.

For example, suppose you choose a coastal property with a high risk of property damage from hurricanes. In this case, you will likely pay more for coverage than someone who lives inland and is less exposed to weather.

Comparing rates beforehand allows you to see what’s most affordable and to include renters insurance costs in your household budget before signing a lease.

Increase Your Deductible

To reduce your monthly renters insurance cost, you can increase your deductible, which is the amount you pay before your coverage begins reimbursing you. For example, renters insurance policy deductibles typically range between $250 and $2,000. If you select a high deductible, your monthly bill is lower but you will have to pay more out of pocket if disaster strikes.

“Before selecting a deductible amount, determine how much money you have set aside to pay the deductible in the event of a loss,” says Lloyd. “You don’t want to put yourself in a financial bind, especially when dealing with a tragic loss.”

Look for Renters Insurance Discounts

Many insurance companies offer discounts. When you’re gathering renters insurance quotes, make sure you ask about what type of discounts you can qualify for. Common discounts include:

  • Home safety discounts if your home has safety features such as smoke detectors, security systems or deadbolt locks on exterior doors.
  • Multi-policy discount when you purchase more than one policy from a single company, such as renters and auto insurance, also called “bundling” insurance policies.
  • Payment discount if you go paperless, set up automatic payments or pay your annual premium in one lump sum.

You may be surprised at how cheap renters insurance is. We found an average rate of $165 a year for $20,000 worth of property coverage and $100,000 in liability insurance.

Related: Get renters insurance coverage in 90 seconds with Lemonade

 

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