Updated: August 21, 2025
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Renters insurance is often overlooked but can be necessary, especially if you need coverage for personal belongings and temporary housing after a loss. Coverage availability and terms may vary by state and insurer.
Homeowners insurance includes coverage for your home’s structure, but you may need additional policies, like flood or earthquake insurance, for full protection.
Although renters and homeowners policies differ, both can include valuable add-ons, such as identity theft protection or coverage for high-value personal items.
The difference between renters and homeowners insurance is that renters insurance does not include dwelling coverage, which protects the structure of the home. Both policies cover your personal belongings, liabilities and additional living expenses.
Take a quick look at the differences between the two in the table below.
Coverage | Renters Insurance | Homeowners Insurance | Description |
|---|---|---|---|
Dwelling Coverage | No | Yes | Pays for repairs to your home in case of damage |
Personal Property Coverage | Yes | Yes | Pays to replace or repair personal belongings following a covered event |
Liability Coverage | Yes | Yes | Pays for legal fees in the event you are sued due to a covered incident |
Medical Payments Coverage | Yes | Yes | Pays for medical expenses of third parties injured on your property |
Additional Living Expenses (ALE) | Yes | Yes | Pays for your temporary living expenses if you must leave your home due to a covered situation |
Dwelling coverage in homeowners insurance protects the physical structure of your home, including the walls, roof and built-in fixtures, against covered perils like fire, wind or vandalism. This coverage (subject to policy terms, conditions and deductibles) ensures that if your home is damaged or destroyed, the cost to repair or rebuild it is covered up to your policy limits.
Renters insurance does not include dwelling coverage because tenants are not responsible for insuring the building itself because that responsibility falls to the landlord’s policy. Instead, renters insurance focuses on protecting the tenant’s personal belongings and providing liability coverage.
Homeowners and renters insurance both protect against perils, which are events or risks that can cause damage or loss. A peril can include:
Both renters and home insurance cover damage from fire and smoke, whether caused by electrical faults, cooking accidents or wildfires. They also protect against damage from falling objects, such as tree branches or debris; in homeowners insurance, this includes structural repairs.
If your belongings are stolen or intentionally damaged, both home and renters policies can reimburse you for the loss. Coverage often applies whether the incident happens at home or away.
Damage caused by strong winds, hailstorms or hurricanes is typically covered, with homeowners policies protecting structures and renters policies covering personal items. This also includes sudden and accidental water damage from sources like burst pipes or appliance leaks, though flood damage requires separate coverage.
Although these perils are generally covered, policy details and exclusions can vary, so thoroughly review your specific insurance contracts to understand the full extent of coverage.
Certain events and types of damage are excluded from both homeowners and renters insurance, meaning you won’t receive a payout if they occur. These exclusions often involve risks that require separate policies, items that need special coverage or situations deemed preventable.
Standard homeowners and renters insurance do not cover damage from floods or earthquakes. In high-risk areas, separate policies or add-ons are often required for protection against these natural disasters.
Damage from pests, wear and tear, poor maintenance or intentional acts by the policyholder is excluded. These issues are considered preventable or within the owner’s control, so insurance will not cover repair or replacement costs.
If you run a business from home or own high-value items like jewelry, fine art or collectibles, you may need additional coverage. Standard homeowners and renters insurance often exclude business-related losses and may require add-on policies or scheduled coverage for expensive valuables.
You need homeowners insurance if you own your home and want to protect the structure and your belongings. Renters insurance is for tenants who only need to protect their personal property and liability, not the building itself.
Use the table below to see which policy fits your situation best.
Buy Homeowners Insurance If… | Buy Renters Insurance If… |
|---|---|
You have a mortgage lender requiring proof of insurance. | Your landlord or lease agreement requires proof of renters insurance. |
You own the home, condo, or townhouse you live in. | You rent a house, apartment, or condo. |
You want protection for both the structure and your personal belongings. | You only need coverage for your personal belongings, not the building. |
You’re responsible for repairs or rebuilding if the home is damaged. | Your landlord is responsible for the building’s structure and repairs. |
You want coverage for attached structures, like a garage or deck. | You want liability protection in case someone is injured in your rental. |
If you rent out a property you own, standard homeowners insurance usually won’t cover tenant-related risks. You’ll likely need a landlord insurance policy, which protects the building, provides liability coverage and may cover loss of rental income.
The average cost of renters insurance is $12 per month for $20,000 in personal property coverage, while the average cost of home insurance is $218 per month for $250,000 in dwelling coverage. Although renters insurance seems more affordable, unlike home insurance, it doesn’t cover your dwelling, so premiums are typically lower.
However, costs for both insurance types can change based various factors, such as your dwelling coverage, state, deductible and more.
For $20,000 in personal property coverage, renters insurance costs $12 per month or $138 per year, but this can increase if you have higher limits. The table below shows how renters insurance costs can change by coverage level.
| $20K Personal Property / $100K Liability | $138 |
| $50K Personal Property / $100K Liability | $229 |
| $100K Personal Property / $100K Liability | $374 |
| $250K Personal Property / $300K Liability | $757 |
To find cheap renters insurance, consider comparing renters insurance quotes and find a provider that matches your needs and budget effectively.
epairs to your home in cas
A home insurance policy with $250,000 in dwelling coverage costs an average of $218 per month or $2,614 per year. Unlike renters insurance, home insurance pays to repair or rebuild your home if it’s damaged due to a covered event, which is why it costs more. But rates can still change based on your coverage limits.
The table shows how rates can change based on your coverage.
| $100K Dwelling / $50K Personal Property / $100K Liability | $1,518 |
| $250K Dwelling / $125K Personal Property / $200K Liability | $2,614 |
| $500K Dwelling / $250K Personal Property / $300K Liability | $4,373 |
| $750K Dwelling / $375K Personal Property / $500K Liability | $6,139 |
| $1MM Dwelling / $500K Personal Property / $1MM Liability | $7,947 |
The highest coverage isn’t always the best. Carefully assess your coverage needs and compare home insurance quotes to balance adequate protection and affordability.
The main difference between renters and homeowners insurance is structural coverage; only homeowners policies protect the building itself. But both cover personal belongings, liability and additional living expenses. Knowing how these policies differ ensures you choose the right protection for your living situation.
Renters insurance is different from homeowners insurance in that it doesn’t cover your dwelling or the structure of where you live, only your belongings. We answer common questions about their differences.
Homeowners insurance covers the home’s structure, while renters insurance doesn’t. But both policies also cover your personal belongings, liabilities and additional living expenses.
You can have both homeowners insurance and renters insurance simultaneously, but it's typically unnecessary and could be redundant. Homeowners insurance is intended for those who own the property they live in, while renters insurance is for tenants who don't own the property.
If you're temporarily renting out part of your home, your homeowners insurance may provide some coverage, but discussing coverage details with your insurer is important.
Homeowners insurance and landlord insurance are different policies designed for distinct purposes. Homeowners insurance is for those who live in their own homes and covers the structure and personal possessions.
Landlord insurance is specifically tailored for property owners who rent out their properties to tenants. It typically covers the structure, liability and loss of rental income, but not the tenants' personal belongings.
Homeowners insurance is more expensive than renters insurance because it covers the entire structure of the home in addition to personal belongings and liability. Renters insurance only covers personal property and liability, not the building itself, which makes it significantly cheaper.
A building owner's insurance only covers the structure itself, not a renter's personal belongings or liability. Renters insurance protects your possessions and covers you if someone gets injured in your rental unit.
When renting, the tenant is responsible for paying for renters insurance to protect their personal belongings and liability. The landlord pays for insurance that covers the structure of the building itself.
MoneyGeek analyzed quotes from multiple insurance providers across the U.S. using a profile that reflects the average homeowner. By considering different locations and companies, we aim to give a reliable estimate of what homeowners can expect to pay, showing why comparing rates is important.
Homeowner Profile
For our analysis, we created a sample homeowner profile with the following characteristics:
Homeowners Insurance Coverage Details
Unless otherwise specified, we used the following coverage limits to collect quotes for our comparison:
We also compiled data for policies with broader coverage to determine the best companies for insuring expensive homes, upping limits to $1 million in dwelling coverage, $500,000 in personal property coverage and $1 million in liability coverage.
About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. With over five years of experience analyzing the insurance market, he conducts original research and creates tailored content for all types of buyers. His insights have been featured in publications like CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
Passionate about economics and insurance, he aims to promote transparency in financial topics and empower others to make confident money decisions.
