Renters insurance is the most undervalued financial product in America. For roughly $15 per month, you get protection for your personal belongings, liability coverage if someone gets injured in your apartment, and additional living expenses if your rental becomes uninhabitable.
Yet only 55% of renters carry a policy. The rest are gambling with everything they own.
What Renters Insurance Actually Covers
A standard renters insurance policy includes three types of coverage. Personal property coverage protects your belongings against theft, fire, vandalism, and certain water damage. This covers everything from your laptop and furniture to your clothes and kitchen appliances. Standard policies provide $20,000-$50,000 in personal property coverage.
Liability coverage protects you if someone is injured in your rental or if you accidentally damage someone else’s property. If a guest slips on your wet floor and sues, your renters insurance covers legal fees and medical bills up to your policy limit, typically $100,000-$300,000.
Additional living expenses coverage pays for hotel stays, restaurant meals, and other costs if your rental becomes uninhabitable due to a covered event like a fire or storm damage. Most policies cover these expenses for up to 12 months.
Top Renters Insurance Providers
Lemonade — Best Overall Value
Lemonade’s renters insurance starts at just $5 per month, making it the most affordable option available. Their app-based experience makes filing claims remarkably easy, with many claims paid within minutes through AI processing. Standard coverage includes $20,000 personal property and $100,000 liability.
State Farm — Best for Bundling
If you already have State Farm auto insurance, adding renters insurance can save you 15-25% on both policies. Their renters policies average $15 per month with $30,000 personal property coverage and $100,000 liability. State Farm’s claim satisfaction scores consistently rank among the highest in the industry.
USAA — Best for Military Families
Available exclusively to military members and their families, USAA offers renters insurance starting at $10 per month with generous coverage limits. Their replacement cost coverage ensures you receive the current retail value of damaged items, not their depreciated value.
Allstate — Best Customization
Allstate offers the most customizable renters policies, allowing you to add specific riders for expensive items like jewelry, electronics, or musical instruments. Their Identity Restoration coverage helps recover from identity theft at no additional premium cost.
How Much Coverage Do You Need
Walk through your apartment and estimate the replacement cost of everything you own. Most people significantly underestimate this figure. That $800 laptop, $1,200 couch, $600 TV, $2,000 wardrobe, and $500 in kitchen items already total $5,100 — and that’s just the start.
The average renter owns $20,000-$40,000 worth of personal property. If you own expensive electronics, designer clothing, musical instruments, or collectibles, your total could be much higher.
For liability coverage, $100,000 is the minimum recommended amount. If you have significant assets to protect or host guests frequently, consider $300,000 or adding an umbrella policy.
Filing a Renters Insurance Claim
Document everything before you need to file a claim. Photograph your belongings, save receipts, and keep a home inventory spreadsheet. Apps like Sortly and Encircle make this process simple.
When you need to file, contact your insurer immediately. Most companies have 24/7 claim hotlines and mobile app filing. Provide photos of the damage, a police report number for theft claims, and your home inventory documentation. Claims for straightforward incidents like theft or fire typically settle within 1-3 weeks.