Renters Insurance Explained: Why You Should Get a Policy in 2026
Your apartment floods and destroys your electronics. Someone breaks in and steals your laptop. Your friend slips on your stairs and breaks an arm. Without renters insurance, you're paying for all of these scenarios out of pocket.
With renters insurance, you're covered. You can replace what you lost without draining your savings, and you're protected if someone gets hurt in your place. Whether you're a first-time renter, a young family, or required by your landlord to carry coverage, renters insurance is an affordable safety net for the things that matter.
What is renters insurance?
Most renters don't realize how much they own. Even in a small apartment, you might have $15,000 to $30,000 in personal property between your electronics, furniture, clothing, and appliances. And if you lose those items, you’re paying out of pocket — unless you have renters insurance.
Here’s what commonly triggers renters insurance claims:
- Theft. Stolen laptops, phones, jewelry, bicycles … you name it.
- Fire damage. Cooking mishaps, smoking, electrical faults, or even lighting.
- Water damage. Burst pipes, leaking appliances, and faulty plumbing.
- Vandalism. Intentional property damage affecting personal property and apartment interiors.
- Everyday accidents. Spills, appliance malfunctions, or minor mishaps.
Sources: Zipdo Education Report 2025: Renters Insurance Statistics and Gitnux Report 2025: Renters Insurance Statistics
Why does renters insurance matter?
Nearly four in ten renters report filing a claim at some point. It’s not a question of if it happens, but when .
The numbers tell the story: Average theft-related payouts hover around $1,200 . Fire-related claims? Closer to $8,000 . Without coverage, you’re absorbing those costs yourself.
Renters insurance means you recover quickly instead of spending months rebuilding.
Why do landlords require renters insurance?
Unlike auto insurance, renters insurance isn't legally required in any state, but some landlords require it as a condition of your lease.
Here's the reality: Your landlord's insurance covers the building and property, not your belongings or your liability. If you accidentally cause damage (think: a kitchen fire, a burst pipe from a frozen hose, or water damage from an overflowing bathtub), you're legally responsible for the cost of repairs.
Without renters insurance, your landlord would either have to file a claim on their own policy (raising their premiums) or come after you for the money. With renters insurance, you’re protected from out-of-pocket costs and your landlord avoids costly legal action.
It's a win-win for everyone.
Here’s what happened to Reddit user u/wildmagicwoman when her apartment flooded at 3:00 a.m.
“The upstairs neighbor broke the fire suppression sprinkler on his ceiling. Destroyed 16 apartments before they got things under control. I wake to the sirens and a cascade of water.
“I called my insurance company and by 7am my stuff was packed up and in storage. I got to stay in a very nice business hotel for a full month while my place was repaired.”
How does renters insurance work?
You pay a monthly premium. In return, if your belongings are stolen, damaged, or you're held responsible for an accident in your rental, your policy covers the costs (minus your deductible).
Key terms:
- Premiums : What you pay monthly, typically $13 to $30 depending on your coverage.
- Deductibles : The amount you pay out-of-pocket when you file a claim. Higher deductibles = lower monthly premiums, but you'll pay more if something happens.
- Coverage limits : The maximum your insurer will pay per category or overall.
- Claims process : Report the loss, provide documentation, and receive compensation based on your policy.
Example scenario:
Someone breaks into your apartment and steals a laptop and TV worth $2,000. With a $500 deductible, insurance gives you $1,500 to replace those items — so you’re not stuck paying the full $2,000.
What renters insurance covers (and what it doesn't)
What’s typically covered
- Personal property , such as electronics, clothing, furniture, appliances, children’s items, and more.
- Liability protection , including medical bills or payments if someone is injured in your rental.
- Loss of use covers temporary housing and living expenses if your apartment is uninhabitable due to a covered loss.
What’s not covered
- Natural disasters like floods or earthquakes.
- High-value items like jewelry, antiques, art, or expensive instruments that might not be covered at their full appraised value.
- Roommates' belongings (unless specified in your policy).
- Business-related equipment like inventory or supplies.
Optional add-ons to consider
Depending on your situation, these extras can fill coverage gaps:
- Water backup coverage to protect against plumbing or sewer backups.
- Scheduled personal property for high-value items not covered under a regular policy.
- Pet liability coverage gives you extra protection if your pet causes injury or property damage.
How much does renters insurance cost?
On average, renters insurance costs between $13 and $30 per month (less than a streaming subscription).
What affects your rate?
- Location: Urban vs. rural areas, crime rates, local natural disaster risks.
- Coverage amount: Higher limits = higher premiums.
- Deductible: Choose a higher deductible to lower your monthly cost.
- Pets: Certain breeds may increase liability coverage costs.
- Claims history: Prior claims can raise your rate.
- Payment frequency: Paying annually instead of monthly can save you money.
| Average Renters Insurance Cost Per Year | ||
|---|---|---|
| Provider | Starting at | Up to |
| State Farm | $104 | $165 |
| USAA | $123 | $208 |
| Country Financial | $171 | $219 |
| Auto-Owners | $118 | $206 |
| American Family | $175 | $255 |
Source: Forbes
💡 Author’s note: Since I pay my State Farm renters insurance annually, it works out to just under $12/month.
More for renters:
- Does Renting an Apartment Help Build Credit?
- Why is Rent So High?
- Moving Loans Can Help With Relocation Costs
- 10 Moving Budget Tips to Save Money (and Your Sanity)
Why you should get renters insurance in 2026
Renters insurance gives you peace of mind when unexpected events happen. As the cost of replacing items like electronics and furniture keeps rising, having coverage means you can recover without derailing your finances.
Key benefits of renters insurance
- Protects your stuff : The average apartment contains $20,000 to $30,000 in belongings. Renters insurance helps you replace them without going broke.
- Covers you beyond your apartment : Stolen items from your car or during travel may be included.
- Offers liability protection : If someone is injured in your apartment, your policy helps cover medical bills and legal costs.
- Covers temporary housing : If your apartment becomes uninhabitable, your policy covers hotel stays and other temporary housing costs while repairs happen.
- Fulfills landlord requirement : Many lease agreements now mandate proof of insurance, so you might need it anyway.
Where to get a renters insurance policy
Traditional insurance companies
Traditional insurers offer renters insurance alongside auto and home insurance, so you can bundle policies for discounts. They have agents available to answer questions and help you understand your coverage.
Popular options include:
💡 Tip: Military members and their families should look into the insurance rates offered by USAA.
Digital-first insurers
Digital-first companies handle everything online or through an app — from quotes to policy management and claims. They're great if you prefer managing your insurance on your phone and want fast, transparent pricing.
Popular options include:
What to look for when comparing policies
Deductible amounts
Policies with lower deductibles are easier on your budget after a claim, but they often come with higher premiums. When comparing policies, find a balance between a deductible you can afford and a payment that fits your budget.
Replacement cost vs. actual cash value
This determines how much you’ll be reimbursed. Replacement cost policies cover the full cost to buy new items, while actual cash value (ACV) policies only pay the depreciated value. If you have electronics, furniture, or other higher-value items, replacement cost coverage could be more beneficial in the long run.
Coverage limits
Coverage limits set the maximum your policy will pay for different types of losses. Make sure your limits are high enough to replace your belongings and cover liability if someone is injured in your apartment. If you're underinsured, you'll have to cover the difference out of pocket.
Customer service quality
Good customer service can make a big difference when you need help or file a claim. Look for insurers with responsive support, clear communication, and a reputation for handling claims fairly. Reading reviews or asking friends can help you gauge the service experience.
Mobile app and claims process
A good mobile app or online claims process can make managing your policy easier. You can file claims, check coverage, and update information quickly from your phone, saving time and stress when it matters most.
How to choose the right amount of coverage
The best way to figure out how much coverage you need is to list everything you own and estimate what it would cost to replace it all. This gives you a realistic picture of your coverage needs.
Start with a home inventory
Walk through your apartment and write down:
- Electronics (TV, laptop, phone, gaming systems)
- Furniture (couch, bed, dresser, desk)
- Clothing and accessories
- Kitchen appliances
- Sports equipment, bikes, or hobby gear
- Anything else of value
Add up the replacement costs. This number should roughly match your personal property coverage limit.
Note any high-value items
If you have expensive electronics, jewelry, collectibles, or home office equipment, standard coverage might not be enough.
You can add scheduled personal property coverage (sometimes called a "rider") to protect these items individually. This costs a bit more but gives you full replacement value for items that matter most.
Estimate liability
For most renters, $100,000 in liability coverage is enough. But if you frequently host guests or have pets (especially exotic or restricted breeds), consider going higher for extra protection.
How to file a renters insurance claim
Filing a claim doesn't have to be stressful. Most insurers make the process simple and quick.
- Document everything right away. Take photos and videos of the damage or stolen items from multiple angles. Keep receipts, invoices, or bank statements that show what you owned and what it cost. The more documentation you have, the faster your claim will be processed.
- Contact your insurer through their claims line, website, or mobile app. Have your policy number ready and be prepared to describe what happened, when it happened, and what was lost or damaged. Most insurers can start your claim over the phone or online in minutes.
- Submit your documentation. Send photos, receipts, and any other proof to your insurer. Many companies let you upload files through their app or website, which is faster than mailing documents.
- Track your claim on your insurer's app or website. You'll be able to see updates as your claim is reviewed and processed. Don't hesitate to follow up if you have questions or haven't heard back within a reasonable timeframe.
💡 Tip: Keep copies of everything you submit. This protects you and helps if there are any questions later.
FAQs about renters insurance
Is renters insurance required by law?
No. Renters insurance isn’t required by any state or federal law, but many landlords include it as a condition of the lease agreement.
Can I get renters insurance if I have roommates?
Yes. You can get a policy that covers multiple roommates, but each person's belongings are only protected under their own policy.
Does my policy stay with me if I move to a new apartment?
Yes. Policies generally follow you, but you must update your address and let your insurer know of any changes in coverage needs.
Does renters insurance cover theft outside the home?
Often, yes. Many policies cover belongings stolen from parked cars, even during travel.
Does renters insurance cover pets or dog bites?
Liability coverage may apply for injuries caused by pets; personal property coverage does not.
Does renters insurance cover water damage or mold?
It depends. Sudden water damage from burst pipes or appliance leaks is usually covered. However, damage from floods, slow leaks, or maintenance neglect typically isn't. If you're concerned about water damage, ask your insurer about water backup coverage as an add-on.
Does renters insurance cover natural disasters like floods or earthquakes?
No. Standard renters insurance doesn’t cover floods or earthquakes. You can purchase a separate policy or explore federal disaster assistance programs.
Can paying my renters insurance annually save me money?
Yes. Paying for a full year upfront can lower your overall cost through discounts and by avoiding monthly processing fees.
Is renters insurance worth it for a small apartment?
Yes. Even small apartments contain valuable items, and coverage is affordable.
Notice: Information provided in this article is for informational purposes only. Consult your attorney or financial advisor about your financial circumstances.
About the author
Bree Ewers is a senior editor, copywriter, and content writer whose work has been featured across the media, small business, and financial industries. She operates Nomad Freelance Content from her home office in Portland, Oregon.
