Renters insurance in California is affordable and helps protect your valuable personal items from theft and unforeseen damage. To help you find great options, MoneyGeek scored the both the cheapest and best renters insurance carriers across California. MoneyGeek’s rating system analyzed the customer service quality, affordability and financial strength of companies serving California to help you find the right coverage.
The Best and Cheapest Renters Insurance in California for 2021: Rankings, Reviews and Rates
Cheap Renters Insurance Companies in California
Many customers select their renters insurance provider based on overall cost. In California, the two most affordable carriers are Lemonade and Allstate. Lemonade’s coverage costs $7 per month, or $87 a year on average. For an Allstate policy, you’ll spend an average of $11 per month or $129 per year.
MoneyGeek’s data on providers’ monthly and annual premiums are for a policy with personal property coverage of $20,000, liability coverage of $100,000 and a deductible of $500. The costs are based on quotes in several ZIP codes across the state of California.
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Best Renters Insurance Companies in California
Besides price, there are many other important factors customers may consider when choosing a renters insurance company. To pick the best renters insurance carriers in California, MoneyGeek ranked companies based on three factors: policy rates, customer service scores from J.D. Power and financial stability ratings from AM Best. The findings show that USAA is the best renters insurance company in California, with a score of 98 out of 100. However, keep in mind that its services are available only to former and current military members and their families. The next best carrier is State Farm, with a score of 94.
USAA's is affordable and its policies all offer replacement cost coverage, making it exceptionally good value for those who are eligible.
Apart from basic coverage, State Farm offers optional features such as roommate/additional insured individuals, identity theft restoration. State Farm also makes it easy to schedule coverage, meaning you can increase the coverage limits for specific valuable items.
Apart from basic coverage, Allstate offers add-ons such as flood insurance, personal umbrella insurance, scheduled personal property and identity restoration coverage. This provider stands out for its wide range of discounts. Other notable aspects include useful online tools and resources, good financial strength and excellent claims satisfaction.
Farmers offers standard coverage as well as optional add-ons such as identity theft restoration, electronics policies and replacement cost coverage. Farmers' coverage is widely available with a range of features. Their agents are easy to contact and you can get prompt and efficient customer support.
Travelers offers standard coverage, as well as bonuses like contents replacement cost and valuable items plus. Additional features include flood coverage (you’ll need to buy a separate policy) and umbrella policies. Travelers' unique services include coverage for travel, events and boats. Travelers offers a mobile app that you can use to report a claim, check the claim’s status, view coverage options, assess existing coverage and more.
Largest Renters Insurance Companies in California
The leading insurance companies in California based on market share are State Farm (18%), Farmers (15%), Liberty Mutual (6%), CSAA (6%) and Allstate (6%). That means these five companies cover nearly 52% of the renters insurance market in the state. While the ideal solution is different for everyone, many renters feel confident by choosing a larger carrier, as larger carriers typically have the financial stability to pay out claims without hassle.
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Average Cost of Renters Insurance in California
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In California, renters insurance can be expensive compared to other states. The average annual rate is $238, which is $79 more than the national average. These prices are for a policy that offers personal property coverage of $20,000, liability coverage of $100,000 and a deductible of $500.
When you compare renters insurance prices from several providers, you have a better chance of finding the most affordable rate. For instance, in California, you can save about hundreds of dollars per year by picking the cheapest company, Lemonade, over the costliest carrier, Nationwide.
What Factors Impact Renters Insurance Cost in California
Several factors can impact renters insurance cost in California, including:
- Location: ZIP code is important because areas with a higher risk of crime, wildfire damage and adverse weather conditions typically have higher rates.
- Coverage Amount: The more coverage you purchase, the higher your premium.
- Deductible: You have to pay a deductible to get your claim processed. A policy with a higher deductible will have a lower premium because you are required to pay more. In contrast, a plan with a lower deductible costs more because the carrier needs to pay more to cover your items.
- Actual Cash Value (ACV) vs. Replacement Cost Value (RCV): An ACV policy considers the loss of value of your items over time, so it’ll pay less for old possessions. An RCV policy will reimburse you for a new item of the same type and quality. ACV plans cost less because they pay less for each claim. RCV packages are more expensive, but they mean you’ll get higher payout for your claim.
- Credit Score: Providers in other states may consider your credit score while determining your premium, but California does not allow credit score to affect the cost of renters insurance rates.
Renters Insurance in California: What You Need to Know
Spending on renters insurance is a smart investment because you can get protection for your valuable personal items at a low cost.
While renters insurance isn’t required in California, the cost of it is relatively low compared to the average monthly price of rent. In the state, about 44% of people are renters, and the average monthly rental rate is $1,614. The average monthly premium is $20 for a basic policy with $20,000 in personal property coverage, $100,000 in liability coverage and a $500 deductible. This rate is 1.23% of the average monthly price of rent.
What Renters Insurance Typically Covers in California
Check what exactly your policy covers before you buy renters insurance in California. A standard renters insurance package will cover personal property, additional living expenses, liability insurance and medical payments.
In California, personal property coverage will typically pay for damages caused by natural disasters like tornadoes, wildfires and others.
What Renters Insurance Typically Does Not Cover in California
Renters insurance in California does not cover all situations. For instance, the following common problems may not be covered by your policy:
- Flooding: Coverage typically includes water damage from broken pipes, but flooding due to extreme weather events is generally excluded. In California, flooding due to natural disasters is quite common, so it’s recommended to get flood insurance through the National Flood Insurance Program (NFIP).
- Earthquake Damage: A standard policy does not cover earthquake damage. California is at risk of earthquakes as it is situated on a fault line, therefore it’s advisable to buy additional earthquake coverage.
- Structural Damage: Landlords have to buy extra coverage for their property’s frame and structure as they are not covered.
- Roommate Property: Your roommate’s possessions are not covered, so they’ll need to buy their own policy.
- Expensive Items: You need to get add-on coverage for costly items and valuables as they are excluded from standard renters insurance policies.
Before buying a renters insurance package, get clarifications on what it does and does not cover. This information can help you report accurate and approved claims.
FAQs About Renters Insurance in California
Expert Insight on Renters Insurance in California
- What advice would you give for tenants looking to buy a renters insurance policy in California?
- What considerations should tenants in California take when determining the best renters insurance company for them?
- Are there any environmental factors renters should consider when deciding whether or not to buy a renters insurance policy in California?
VP of Property Claims at Mercury Insurance
Insurance Agent and Agency Owner at Farmers Insurance
Renters Insurance in California Analysis: Methodology
MoneyGeek analyzed renters insurance premiums from eight of the top insurance companies in California that were provided in partnership with Quadrant. Our analysis includes quotes from ZIP codes across California. Quotes were gathered for policies with personal property coverage of $20,000, $50,000 and $100,000; liability coverage of $100,000 and a deductible of $500.
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