You might rent your home or apartment, but you have several options to protect your belongings. One such option is renters insurance. A renters insurance policy can cover the cost of your possessions in case of an emergency, such as a fire or break-in.
Just as homeowners have insurance options when they buy a home, you can get renters insurance when you sign your lease agreement. Here’s how to apply for renters insurance and what you need your policy to cover.
In this guide:
What should I do before I apply for renters insurance?
Before you get renters insurance, you should know what it covers and the limitations the coverage might have. Renters insurance consists of coverage for the following:
- Personal possessions
- Additional living expenses
These are items you own. When you apply for your renters insurance policy, you’ll input the value of each item you own and would like covered. This includes your clothes, furniture, electronics, and more.
Your policy will want to know the value of your possessions, so be sure you include all your possessions. You may need more coverage than you think. Create a home inventory with a list of your possessions and their estimated value, and tally it up.
Your policy isn’t set-it-and-forget-it; you can update it if you buy a new item or want to add or get rid of something that lowers your total value.
Liability coverage protects you against lawsuits for personal injury or property damage. It covers the cost of defending you in court and the court awards, up to your policy limit.
Coverage starts around $100,000, but at least $300,000 is wise for most renters.
Liability coverage also provides no-fault medical coverage. If a friend is injured in your home, you can submit their medical bills to your renters insurance company. This doesn’t cover you if someone who lives in your home is injured. (That would be for your own health insurance company—or theirs.)
Additional living expenses
If your home is destroyed in a disaster or emergency, additional living expenses (ALE) coverage will pay for you to live elsewhere. It could cover a hotel, Airbnb, meals, gas, and other expenses.
Understand the differences between coverages
The two types of policies you can choose from are:
- Actual cash value (ACV): The cost to replace all your belongings minus depreciation—aka the value now after age and normal wear and tear—up to your policy’s limit.
- Replacement cost: The cost to replace your belongings without calculating depreciation. This option is often about 10% more expensive than ACV—about 10%—but might be worth it, depending on what you own.
It doesn’t cover everything
Renters insurance doesn’t cover several instances, which might mean you’ll need extra coverage. For instance, flooding and earthquake insurance aren’t covered, so you’d need separate policies for both. Renters insurance doesn’t cover infestation. And if you live with a roommate or sublet, your renters insurance doesn’t cover their belongings.
How to get renters insurance
- Check what your lease covers. Your landlord might have a renters insurance policy. Talk to your landlord to see what is included and whether gaps in coverage exist. They might limit what’s covered, or they might not have a policy. Most landlord policies will protect them, not tenants.
- Determine how much coverage you need. You might have expensive belongings you want to cover, or you may want standard liability protection that includes bodily injury in case someone gets hurt in your home. You might need additional coverage for excluded events. For instance, flood insurance is a separate policy.
- Make sure it’s in your budget. Like any additional cost, check to see how much you expect to pay with your new expense. If the policy estimate is too high, see whether you can bundle with other policies (such as auto insurance) or increase your expected out-of-pocket costs to lower your monthly insurance premium.
- Compare lenders. See which insurers offer the most value for your investment. How much coverage do you get, and how much do you need to pay for that coverage? What does paying more look like? How about paying less? Do any insurers offer discounts, and do you qualify for them? Check ratings and reviews on Google and the Better Business Bureau to see what others have said about working with those companies. Then get quotes from several insurers.
- Choose your company. Once you settle on the right insurance company, complete an application and await approval. (You can expect to know shortly after applying.)
What is the best renters insurance company?
The best renters insurance is the one that offers the most coverage, has add-ons, offers discounts, and is available in your area. Since everyone has different needs, the best insurance for renters might be different for everyone.
Am I obligated to buy the renters insurance policy once I apply and get approved?
Getting approved can be terrific news, but you’re not obligated to accept renters insurance if you get approved.
How long does it take to apply for a renters insurance policy?
This depends on the insurer you’re applying with. It can take several minutes to an hour to apply for renters insurance. It also depends on how much information you have about your home and belongings. The more items you own, the more detailed your application could be.
What documents do I need to apply for a renters insurance policy?
You should have a home inventory—a list of the belongings in your home and how much each is worth. Try to include when you bought the item and how much you paid for it, even if it’s a ballpark figure. If you can, keep receipts handy for verification.
You can use calculators or apps to determine how much your possessions are worth and organize them for easy access.
Can I get renters insurance online?
Most insurers let you complete applications online. You may want to talk to your auto or other insurance company about discounts and deals you may qualify for if it offers renters insurance. But only take this step if you’re ready to complete an application with that insurer. Otherwise, you can apply online without accepting the policy.
What does a renters insurance application look like?
No universal standard exists for renters insurance, so not all applications look the same. But you can expect to see many of the same general questions throughout all of them.
You’ll fill out personal information about yourself, including your birthdate, address, and previous addresses, along with how long you lived there. If you have a co-applicant—a spouse, for example—they will also provide personal information. You’ll need to answer questions about your income and employment.
Then you’ll advise how much you want for each area of coverage. You’ll choose how much you want your personal property limit and other structures to amount to. You’ll also complete information about your home, such as the type of home (apartment, townhome, or single-family home, for example) and its condition.
Some applications ask you to specify the home’s condition, while others inquire about your credit history. If you have children or pets, there are spaces to answer questions about them as well. Many applications ask specific questions about items in your home. Most applications will take a while to complete, so set aside 30 to 60 minutes.
Will applying for renters insurance affect my credit?
Yes, insurance companies will check your credit when you complete a renters insurance application. But many states use credit-based insurance scores, not the FICO or VantageScore models that many other lenders use.
Not all states use this model, but the point is to see whether you’re likely to file a claim based on your credit history. A higher credit score can help you qualify for a lower insurance premium.
Will I pay fees to apply for renters insurance?
Some applications require an application fee, but it varies by the insurance company.
Is renters insurance required by law?
Renters insurance isn’t required by state or federal law. Some landlords require renters insurance. When you’re exploring properties to rent, ask the landlord about renters insurance and whether you need it. Ask what, if any, coverage they have for renters already.
Can my landlord require renters insurance?
Landlords in most states can require renters insurance among their tenants, but there’s no mandate to do this. The requirement varies by landlord.
Note: Landlords in Oklahoma aren’t permitted to require renters insurance.