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We compared the top three renters insurance policies this year. And the winner is …
Updated October 5, 2022
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Imagine it. No mortgages or property taxes. More freedom, less upkeep. That’s the life of the renter for you. That and two times more break-ins than homeowners1. Let’s crunch the numbers on this.
The average renter owns between $20,000-$35,000 worth of stuff. The average HO-4 renters policy costs about $180 per year. If you’ve got a SimpliSafe camera in your bedroom, why not renters insurance in your backpocket? Don’t make the mistake of thinking one is more important than the other. Home insurance is home security — even for renters.
If that $180 fee is still giving you second thoughts, don’t worry. There are a few top insurance providers who might be able to make you a better deal. Here’s our shortlist.
Did You Know: From 2000 to 2017, the number of older renters in the U.S. ballooned by a whopping 43 percent1. Cheap renters insurance is a definite plus for older folks on tight budgets, but access to emergency medical services may be a higher priority. Here are our favorite medical alert systems for golden agers on fixed incomes.
We tested, compared, and crunched the numbers on the best insurance companies this year and picked the top three renters insurance policies. The criteria we used to select our top brands are the ones the renters we’ve spoken to are most interested in:
Is $5 per month for a renters policy that covers all your stuff – even the laptop you left on the front seat of your car by accident – actually possible? According to Lemonade, one of our top all-around insurance providers of the year, it is.
We’ve covered all the features that make Lemonade great in a lot more detail in our Lemonade homeowners pricing and protections guide. The long and short of it is: Everything that makes Lemonade home insurance a solid pick carries over into their renters insurance — low premiums, quick quotes and payouts, attentive customer service, and straightforward policies.
That’s probably why Lemonade led the pack in overall customer satisfaction in J.D. Power’s latest industry-wide renters insurance survey.1 This was no small feat in the middle of a pandemic.
Another reason Lemonade is such a people pleaser is because of their digital-first ethos, which means no office appointments, no paperwork, and no on-site claims reviews. (Lemonade’s AI takes care of most of that.) Obviously, this might not be the ideal setup if you like paying the occasional visit to your neighborhood insurance office. But for a lot of us who manage our households on our iPhones, the transition will be welcome and easy.
Getting started with Lemonade takes about 10 minutes, and, as we’ve said, monthly payments can be as low as $5 per month, though that will depend on where you live. And that’s the other bone we have to pick with Lemonade renters insurance policies. Availability is limited to 22 states for the time being.
Renter's Tip: Always keep photos of your valuable possessions. If you can, snap photos of your receipts, too. Stick all those jpgs in a folder and have them ready to upload in case you ever file a claim. Without proof that they exist, you’ll be hard-pressed to find any insurance company willing to fork over a check for your lost or damaged things.
State Farm says they’ll protect everything in your apartment for the price of a large pizza. (With extra toppings or without? That’s our question.) Joking aside, State Farm offers renters complete coverage for their belongings, excellent customer satisfaction ratings, and policies that basically pay for themselves when you bundle in your auto insurance.
State Farm might not have Lemonade’s cool factor, but they can go head-to- head with their lingo-free policies. Getting to know your State Farm renters plan, in other words, isn’t going to involve any head-scratching or squinting. Believe it or not, that’s a huge plus in this industry.
But where State Farm really scores points is with its renters protections. Just like their homeowners plans, State Farm’s HO-4 renters policies don’t stint on replacement coverage. That means you’ll get a check to buy your belongings back at their current market value in the event of damage or loss, not at Craigslist prices.
Two other great State Farm perks that you won’t find everywhere are inflation protection and business property insurance. The first increases your belongings coverage to keep pace with rising inflation. The second covers any work equipment you have, both inside and outside your apartment or home.
Perks and easy-to-read policies are one thing. But most renters are more interested in insurance that won’t break the bank. And the truth here is that State Farm quoted us about $11 per month for our renters policy.
This wasn’t the cheapest renters insurance quote we found, but it also didn’t include the discount we uncovered when we reported on State Farm’s auto insurance bundles. So plans for the price of a pizza? We’re leaning toward a “yes” there.
About the only thing State Farm could improve, in our book, is its online quote generator. It’s perfectly functional, but it could definitely use a refresh.
FYI: Your renters policy will cover your Surface Book whether it gets destroyed by a leaky ceiling or a thief lifts it off your back seat. But it won’t cover common accidents like your dog knocking it off your counter while he’s escaping with your last spring roll. Insurance for everyday accidents would fall under separate portable electronics coverage.
Just when you thought you couldn’t do any better than a $5 Lemonade renters insurance policy or a State Farm auto insurance bundle for the price of a pizza. Along comes Nationwide with cheap plans, extra perks, and special insurance for long-term renters.
The first thing you should know about Nationwide is that you’re going to find competitive rates. Nationwide insurance quotes were among the lowest we found this year.
The second thing you should know is that with Nationwide, paying less doesn’t mean less protection. This is particularly true when it comes to many renters’ prime concern: coverage for their belongings.
Nationwide’s Brand New Belongings® coverage is replacement cost value (RCV), meaning that, if your stolen 2010 Sonos speaker costs $200 more to buy in 2023, you’re going to get a check for the 2023 speaker. Granted, it’s a two-step process, and you will have to pay a little extra, but in our opinion, it’s worth it.
Nationwide also slips a few goodies into its basic renters plan that we haven’t seen elsewhere. The highlights are workers compensation, ID theft restoration (up to $25,000), and credit card coverage, which protects you against fraudulent credit card and ATM transactions. The number of “romance scams” Americans reported to the FTC last year alone was bonkers, so this is no small bonus.
Finally, a Nationwide plan may be your best bet for one reason alone: You’ve fixed up your rental property and want to protect your investment. Ordinarily, renters insurance policies don’t cover “property” damage. Nationwide has your back here.
Did You Know: Romance scammers con their partners into falling in love with them and then bilk them for all they’re worth. The FTC logged 56,000 romance scams in 2021 alone. That’s an almost 70 percent jump from 2020.5
Renters insurance is a security net for your belongings and insurance against ever getting stuck with legal or medical bills for accidents on your rental property.
Like homeowners policies (HO-3), renters policies (HO-4) have monthly premiums — a fee you pay to have your insurance policy at the ready should you ever need it. If you do end up filing a claim, you’ll only foot the amount above your deductible.
To put that into concrete terms, if a pipe bursts in your apartment and destroys your living room furniture, and your deductible is $500, you’ll pay anything above that.
While lower deductibles may seem sweet from a distance (the thought of paying less in the event of an accident is attractive), just remember that the lower your deductible, the higher your monthly bill.
Besides plumbing disasters, there are a number of situations when you might need to file a renters claim. The most common are bad weather, fire and smoke damage, and theft. There are also a few situations where your renters insurance noticeably doesn’t cover you. We’ll go into those in more detail below.
Besides the leasing factor (you don’t own your rental property, you’re only using it for a period of time), renters insurance is generally simpler and cheaper. There are some exceptional renters policies — check out Nationwide above — that offer an unusual variety of additional protections for renters, but in the main, you’re protecting your belongings and any personal liability (legal or medical) you bear for accidents on your rental property.
Here’s a real-world example …
If you owned a house, and the roof collapsed, flooding your bedroom and destroying everything in it, your HO-3 policy would cover the damage to your things and the damage to your property, roof and bedroom.
With renters insurance, the roof and your bedroom wouldn’t enter the equation. Your policy would simply cover your stuff. (It would also cover any additional living expenses you ended up paying while your rental property was uninhabitable. But that’s another coverage entirely that we’ll get into below in our breakdown of renters coverage.)
FYI: The most common renters claim, according to Nationwide, is theft, followed by fire and smoke damage, and then liability.
As you’ve probably noticed, we’re generally pro-insurance around here. So, while some landlords won’t require you to take out renters insurance, we always recommend it.
Renters policies are cheap (Lemonade starts at $5 per month). And, as we’ve seen, you probably have more stuff of value than you think. Remember, just because you don’t own a home, doesn’t mean you haven’t accumulated valuable possessions.
According to Zillow, the average long-term renter stays put for years.6 If you’re one of them, you’ve also probably made some home improvements. Without a renters policy that covers additions (not all do), your investment is history.
Finally, if you rent an apartment, you bear more risk for damage and theft than the average homeowner, just by virtue of the fact that you’re sharing a building with other people.
For example, you may be extra careful about locking the front door. Your neighbor across the hall might not be. With an HO-4 renters policy in your back pocket, your stuff is protected against careless neighbors, freaky weather, and standard building disaster scenarios like busted pipes, fires, or leaky roofs. Without insurance, you could be out tens of thousands of dollars.
Did You Know: According to a University of North Carolina study, over 60 percent of burglars said they wouldn’t enter a property if it had an alarm.6 For more ideas on how to burglar-proof your rental property, take our quick home security quiz. And be sure to read our roundup of the best security systems for renters.
Your renters insurance policy covers these four major areas.
You may not realize this, but your HO-4 renters policy covers your stuff whether it’s on your property or not. Before you celebrate (and jump on your insurance app to file a claim for the iPad you dropped out the bus window last month), your policy won’t cover everyday accidents like dropping and spilling. But if you leave your iPad in the car and a thief breaks in and steals it, you are covered.
As we mentioned above, to get a check to cover your losses, you’ll need to have documentation. Renter or homeowner, it’s the same. So take pics and gather receipts (you can take pics of those, too) and stick them all in a folder for safekeeping.
You don’t have to get sued to end up in a situation involving medical bills or a claims payout.
Picture this. It’s dinner for two at your place. Your Bananas Foster has a mind of its own and jumps off your stove and onto your significant other’s lambswool sweater. Your plus-one is fine, but their sweater is toast. Your renters insurance would kick in.
It’s the same if a guest trips on your end table and sprains their wrist. With a HO-4 policy, you’re covered for urgent care visits up to your policy’s limit.
If something goes seriously wrong in your rental property and you have to move out for a few days, your renters policy will spring into action and pay you the difference in living expenses (lodging, food, and gas). If it’s a case where you can’t move back in, your policy may help with the bills for your new living arrangement for up to two years.
Did You Know: If you have a roommate, your renters insurance doesn’t cover their stuff. (Not even if you have a picture of it.)
Actually, more than you’d think. Here’s a breakdown of the most common renters scenarios you may have thought were covered but aren’t.
FYI: Your renters policy doesn’t cover your car — or any motor vehicles — but it does cover any stuff inside your car. If your bike goes missing, on the other hand, you may be covered, depending on your plan.
According to the latest records from the National Association of Insurance Commissioners (NAIC), the average HO-4 renters policy costs about $15 per month, or $180 per year. That’s the ballpark. But that doesn’t mean you’ll be paying that amount. Here are a few reasons why.
Renters insurance policies vary from state to state and area to area. Renters in Georgia, for example, pay $234 per year on average for their insurance, while in California, they pay $178.
Those rates aren’t set in stone either. A Georgia renter living in a secure, recently renovated building located in a safe neighborhood may have a lower insurance bill than a California renter living in an earthquake-prone area with higher-than-average crime.
The second main pricing factor for renters insurance is how much insurance you need. Do you want premium protection or standard for your belongings? What’s the right amount of personal liability coverage for you? Are you willing to pay for additional insurance for your portable electronics or big ticket appliances?
Finally, your deductible plays a role in your insurance rate, too. Low deductibles mean more help from your insurance company if you ever need it, but they also mean higher monthly bills for you to pay.
Did You Know: Mississippi tops the charts for renters insurance premiums at $252 per year. For what it’s worth, that’s still less than two large cheese pizzas per month.
This is a great question. The all-around top criterion is value for money, not just price tag. For example, paying a little more for premium coverage for your things — RCV coverage in the lingo — might be worth the slightly higher monthly bill. That’s why we always balance affordability and coverage when assigning a SecureScore™ rating.
Next on our list would be customer service. Check out customer satisfaction and claims satisfaction ratings (we always do). If it’s a hassle to get a payout, that’s a red flag.
You’ll also probably want to compare app reviews, too. For many of us moving forward, apps are going to be the primary means of communicating with our insurance companies, filing claims, and monitoring our policies, so if the app is a dud, chances are, you’re going to be frustrated.
Finally, discounts and bundles can get you even better value for your money, so always explore the situation there. Most insurance companies give you discounts for going paperless, paying annually, and better home security.
Check out all the deals, lay the figures out side by side, and tally them up. Even if they aren’t the main criteria for selecting an insurance company, sometimes these special incentives will be enough to make you a customer.
Renter's Tip: Bundling your auto and renters insurance is the easiest way to save on your monthly premiums. Typical savings is between 4 and 10 percent, but with some providers you can score discounts up to 40 percent.
Nice job, you’ve made it to the end of our guide! You’re a renters insurance expert now. But don’t be a stranger. The renters market is in constant flux and we’ll have new recommendations and insights to help you make better, more informed choices about your HO-4 policy as time goes by.
Is renters insurance cheap?
Yes. The NAIC went state to state and found the average renters insurance policy cost just $15 per month. Your rate will vary depending on where you live, the condition of your rental property, and your claims history, but that’s about what you can expect to pay.
Do I need to have renters insurance?
Not necessarily. Some landlords require it, some don’t. Whatever your lease says, we recommend having a renters policy in your back pocket. Renters insurance is relatively cheap and you probably own more valuable stuff than you think.
Does renters insurance cover pests like roaches, mice, and rats?
No, it doesn’t. Infestations are on landlords because they involve buildings, which makes sense. What you can do to protect yourself is make sure any property you’re renting is pest-free before signing your lease.
Does my renters policy cover property damage?
No. Unless you have a policy that covers the additions you make to your rental property (i.e., a new kitchen you put in yourself), renters policies don’t cover property. Like pest infestations above, that’s on your landlord.
When do I have to renew my renters insurance?
Most policies are year to year. This is mostly good for you. While you aren’t protected by a price lock, you do have the leeway to switch providers if you aren’t happy and to tweak your premium if your situation changes.
VOA. (2019). Number of Older US Renters Spikes 43%
https://www.voanews.com/a/number-of-older-renters-spikes-43-/4825955.html
USA Facts. (2021). Who are the renters in America?
https://usafacts.org/articles/who-is-renting-in-america-cares-act/
US Census Bureau. (2018). DEMOGRAPHIC CHARACTERISTICS FOR OCCUPIED HOUSING UNITS.
https://data.census.gov/cedsci/table?q=homeownership&tid=ACSST1Y2018.S2502&vintage=2018&hidePreview=true
J.D. Power. (2021). Home Insurers Struggle with Customer Loyalty as Boomers Flock to Rental Market, J.D. Power Finds.
https://www.jdpower.com/business/press-releases/2021-us-home-insurance-study
Federal Trade Commission. (2022). FTC Data Show Romance Scams Hit Record High; $547 Million Reported Lost in 2021.
https://www.ftc.gov/news-events/news/press-releases/2022/02/ftc-data-show-romance-scams-hit-record-high-547-million-reported-lost-2021
Zillow. (2022). The Long-Term Renter.
https://www.zillow.com/report/2017/renters/long-term-renters/
Kuhns, Joseph. (2012). Understanding Decisions to Burglarize from the Offender's Perspective.
https://www.researchgate.net/publication/268444817_Understanding_Decisions_to_Burglarize_from_the_Offender%27s_Perspective
