Many renters think that if there’s a disaster in their rental home – a flood, theft or fire – they’re covered by their landlord’s insurance policy. They’re wrong. If you rent your home, the owner insures the building itself, but you’re responsible for insuring your personal belongings. Imagine having to spend tens of thousands of dollars to replace your furniture, clothing, computers and other property after a fire, theft or even a water leak from another apartment.
Fortunately, renters insurance can protect your property for a very affordable price—often around $20/month. It can also provide liability coverage in case a guest accidentally injures themselves in your home and needs medical attention. It can also reimburse you for a laptop computer stolen from your car or pay for a hotel if you can’t live in your home after a disaster your insurance covers. While most policies offer a similar package of options, they all have their quirks. We’ll help you find the renters insurance that’s best for you.
- American Family
- Erie Insurance
- Liberty Mutual
- State Farm
There are some terms and conditions that crop up in most renters insurance policies. It’s important to understand them so that you can purchase the coverage you need—and, if you have a claim, avoid unpleasant surprises.
You’ll have to pay a deductible before the insurance company reimburses you for any losses. The higher your deductible, the lower the monthly premium.
Replacement cost versus actual cash value
If you bought a couch for $1,000 five years ago, the full replacement cost is the amount it would cost you to buy another new couch of the same type and quality today. The actual cash value is its current resale value, which has depreciated since you bought it and might amount to just a few hundred bucks. Make sure your policy covers the full replacement cost. (Unless stated otherwise, all of quotes below include full replacement cost.)
Water, sewer and flood coverage
Not all types of water damage are covered by renters insurance. Damage caused by a leak from another apartment is usually covered. Damage caused by backup of the sewer or plumbing system might be covered, or you might need to get an addition or “endorsement” to your policy. Coverage for flood damage is rarely included in renters insurance and must be purchased as a separate policy.
A quote is just a quote
In other words, it’s an estimate of your coverage. The actual policy spells out the nitty-gritty details. Before you sign, read the policy carefully and ask an agent to explain anything you don’t understand. Pay special attention to “exclusions” – that is, what the company is not willing to pay for.
Our Top 10 Renters Insurance Providers
All quotes below are based on the same information: an apartment in a middle-income neighborhood in Toledo, Ohio, occupied by a 35-year-old woman, with $20,000 of property to be insured. Unless stated otherwise, a basic quote includes a $500 deductible, $1,000 medical payments to others and $100,000 in liability coverage.
an app for that Allstate
One of the biggest U.S. insurance companies—with more than 16 million households insured and $100 billion in assets—Allstate is known for its handy online features. Need help figuring out the value of your insured property? The “What’s Your Stuff Worth?” function lists typical belongings with an average value for each ($1,000 for a laptop computer, $500 for a suit) and clickable icons to tally up total value. The Digital Locker app lets you create a photo log of your possessions that’s stored on the cloud, so even if a fire destroys your apartment, you’ll have proof of your possessions. (You can also put your documents in the cloud yourself if you go with another company, or even email the docs to yourself.)
the old-fashioned way American Family
American Family, which has $6.9 billion in customer equity, offers competitive rates for renters insurance. The tradeoff is customer service. You can’t get a quote on the website, so you’ll have to kick it old-school and actually talk to an American Family representative to get basic information about premiums and conditions. The upside is good old-fashioned value: American Family is one of the most highly ranked companies in J.D. Power’s 2015 study of renters insurance for overall customer satisfaction.
insurance credit score Erie Insurance
It pays to be selective. Erie Insurance—which only operates in 12 states but is a Fortune 500 company nonetheless—does not accept all applicants for insurance, screening out those who have weaker credit and insurance histories. Because Erie insures a smaller pool of low-risk customers, it’s able to service those customers to a high level of satisfaction. This is why Erie Insurance has won the highest ranking from J.D. Power in the last four years. If you get renters insurance from Erie, you can expect comprehensive coverage from a company that has a reputation for personalized service from local agents and fast, fair settlement of claims.
keep things simple Farmers
Farmers insures more than 10 million households across the U.S. The online quote process is fast and easy, though it offers few options for expanded coverage; talk to an agent for more details. Prices are competitive, so if you’re looking for a streamlined policy without a lot of extras, Farmers could be a good choice.
of commitment GEICO
GEICO offers big discounts on renters insurance if you’re willing to pay for a whole year up-front. GEICO partners with local insurance companies around the country, essentially acting like an agency. When you get an online quote, GEICO’s data network compares information from these local insurers and gives you the most competitive rate. The drawback is that an online quote from GEICO can’t be customized as much as some other major insurance companies’. But if you call to get more information, an agent will gladly walk you through the details.
high-end renter Liberty
Renters insurance isn’t just for people who can’t afford to buy a nice home. Liberty Mutual, the third largest property and casualty insurer in the United States, is known for providing the extremely comprehensive coverage needed by high-end renters, including up to $1 million in liability coverage. Let’s say you’re an actor in LA, renting a swanky midcentury bungalow with a swimming pool (where a guest could accidentally hurt themselves) and a big yard for your Rottweiler (which hopefully won’t bite anyone, but you never know); Liberty Mutual will cover it. Add coverage for a Hollywood jewelry collection, and Liberty’s prices, which run higher than some of its competitors’, and it looks like a wise investment.
A Fortune 100 company with over $150 billion in assets, Nationwide is one of the giants in the industry. Nationwide makes a selling point of its discounts, which include up to 20 percent off if you get car insurance along with renters insurance, up to 15 percent off if your home has qualifying smoke, fire and burglar alarms, and up to 20 percent off if your policy has no claims for a period of time.
the lowest cost Progressive
We’ve all seen the quirky TV ads with Flo, the headband-wearing, aggressively perky face of Progressive. Of all the renters insurance companies we surveyed for this report, Progressive quoted the lowest rates. It also listed the fewest options on its website, so it’s a smart move to talk to an agent about exactly what’s covered and whether you want to expand the basic policy.. If price is your only criteria, Progressive is a clear winner. It’s up to you to investigate and make sure that you’re getting the coverage you need.
good balance of
coverage and cost State Farm
State Farm’s renters insurance isn’t the cheapest or the most expensive, the least or the most comprehensive. Its website offers more customization options than some insurers but fewer than others. In other words, its coverage is balanced, well-rounded and fairly priced. Like pressed khakis and a clean white shirt, it’s the “normcore” of insurance coverage. State Farm insures more cars and homes than any other company in the U.S.—proof that the basics never go out of style.
and their families USAA
The old U.S. Army slogan, “Be all you can be,” applies to renters insurance from USAA, which is much more comprehensive than what most other insurance companies offer—and is only available to active military members, veterans and their families. You can’t get a price quote if you’re not a USAA member, but the website states that a renter’s policy can cost as little as $12. USAA boasts high financial strength and a place on the Fortune list of the world’s most admired companies.
We looked at each company’s experience, online presence, customer service and financial strength to rank them. Unless noted otherwise, we also obtained two quotes from each insurance company: first, a basic quote for a middle-income renter; second, a quote with higher coverage limits and additional endorsements for the same middle-income renter. This allowed us to evaluate the range of options offered by each insurance company and compare them to one another.
Before you sign on the dotted line, or even talk to an agent about the details, you need a good estimate of what renters insurance will cover and how much it will cost. This should be a quick and painless process so that you can compare policies from a few different insurers before committing to one.
We looked for companies that provide clear, detailed information on their websites, or have knowledgeable agents who can clarify the trickier points of coverage—preferably both.
Every renter has different needs. To reflect this, we looked for insurance companies that allow consumers to tailor coverage to their budget and other factors.
Many of the insurance companies in this report are Fortune 500 companies with a nationwide presence and billions of dollars in assets. With the exception of Farmers, all received an A rating or higher for financial strength from A.M. Best.
We looked for companies offering a good balance of cost and coverage. Some have higher rates but also offer more comprehensive protection or higher coverage limits.
We checked how each company was rated by the Better Business Bureau and by J.D. Power’s most recent study of renters insurance. We also gave some consideration to other online customer reviews, though those should be taken with a grain of salt.
A study that rates the top providers of renters insurance on customer satisfaction and other factors.
A.M. Best, a company that evaluates the financial strength of insurance companies.
Trade association for the property and casualty insurance industry. The website provides information on trends in the industry and other resources for members.
An industry-supported organization that seeks to improve the public understanding of how insurance works by providing information for consumers, researchers and the media.
News, industry research, legal updates and more for insurance buyers and sellers.
Information, decision-making tools and customer reviews about insurance companies.
A nonprofit organization that evaluates businesses and mediates consumer complaints.