Renters insurance will safeguard your personal belongings and provide you with coverage in case something goes wrong. It doesn’t protect the building that you live in. That’s the landlord’s part of it. But when it comes to damage to the stuff inside your house, such as if you’re robbed or there is a fire in your unit, that’s where renters insurance picks up.
What Renters Insurance Actually Covers
Most renters insurance policies are called HO-4 policies. They concentrate on four major forms of protection.
Personal Property Coverage
This covers your belongings if they are stolen or damaged. It applies to things like clothing, furniture, phones and laptops. Most such policies provide coverage ranging from $20,000 to $30,000, which is sufficient for many renters.
Liability Protection
This helps if someone sues you because they were injured in your rented home or because you caused damage to someone else’s property. Most policies start with at least $100,000 in liability coverage.
Additional Living Expenses
If a covered event, such as a fire, forces you to evacuate your home for the short term, this coverage can help you pay for hotel and food costs, and it helps leftover moving expenses. It’s typically 20 to 30 percent of the amount for personal property coverage you have.
Medical Payments
This covers minor medical expenses if a guest is injured in your home, regardless of fault. The coverage typically ranges from $1,000 to $5,000 per person.
The policy also covers theft of your belongings away from home, usually up to 10% of your total property coverage, anywhere in the world.
Key Perils and Real-Life Examples
Renters insurance covers specific risks listed in the policy. These usually include fire, lightning, windstorms, hail, explosions, riots, smoke, vandalism, theft, falling objects, snow or ice damage, and plumbing leaks.
For example, if a pipe bursts and ruins your rug, your policy can pay for it. If someone steals your TV, the insurance can reimburse you. If you choose replacement cost coverage, you are paid for a new item instead of the reduced value of the old one.
Expensive items like jewelry, bicycles, or collectibles often have low limits, usually between $1,500 and $2,500. Extra coverage is needed to fully protect them.
What’s Not Covered: Common Exclusions
Renters insurance does not cover the building itself. Roofs, walls, and foundations are always the landlord’s responsibility. Floods, earthquakes, and sewer backups are not covered unless you buy extra coverage.
Damage from pests, normal wear and tear, or neglect is also not covered. Intentional damage is excluded as well. Business property and roommates’ belongings are not covered unless they are listed on your policy.
Pet-related injuries may be covered under liability, but damage to the rental unit or certain dog breeds may be excluded.
What Is Covered vs. What Is Not
| Coverage Aspect | Typically Included | Common Exclusions |
| Personal Items | Theft, fire, vandalism (limited off-site) | Floods, earthquakes, pests, neglect |
| Liability | Guest injuries, damage you cause elsewhere | Intentional acts, business use |
| Living Expenses | Hotel and food during covered repairs | Long stays, uncovered events |
| Structure | None (landlord covers it) | All building repairs |
Average Costs Across the USA in 2025
Renters insurance is one of the cheapest types of insurance. On average, it costs about $170 per year or $14 per month for $30,000 in property coverage and $100,000 in liability coverage.
Costs vary by state. Mississippi has higher rates because of theft risks, while North Dakota is much cheaper due to lower weather and crime risks. Cities like New York and Los Angeles often cost more than smaller towns.
Higher deductibles lower your monthly cost. Bundling renters insurance with auto insurance can save 10% to 25%. Credit history, claims history, and apartment size also affect the price.
Average Cost by State Example
| State | Annual Cost | Key Factor |
| Mississippi | $222 | High theft rates |
| North Dakota | $114 | Low natural risks |
| California | $180 | Earthquake add-ons |
| Florida | $200 | Hurricane exposure |
Some companies offer very low-cost digital plans, starting around $5 per month.
What Does Liability Insurance Cover ? A Complete Breakdown
Do You Need It? Landlord Requirements
There is no federal law requiring renters insurance. However, most states allow landlords to require it in the lease. Many landlords ask for at least $100,000 in liability coverage.
Even if it is not required, renters insurance is important because the landlord’s insurance does not cover your belongings. If you live with roommates, each person usually needs their own policy unless everyone is listed on one plan.
Step-by-Step: Filing a Claim
If something happens, notify your landlord and the police if needed. Take photos and videos of the damage. Keep receipts and lists of your belongings.
Contact your insurance company within one or two days. An adjuster may inspect the damage. After approval, you receive payment minus your deductible. Fire-related claims often pay out over $10,000.
Ways to Save and Customize Your Policy
You can lower costs by raising your deductible, bundling policies, and installing safety devices. Living in a secure building or having good credit can also reduce premiums.
Optional add-ons include flood insurance, earthquake coverage, identity theft protection, and pet liability coverage. Updating your home inventory every year helps speed up claims.
Renters Insurance vs Other Policies
Renters insurance is different from homeowners insurance because it does not cover the building. This makes it much cheaper, often costing about 10% of what homeowners insurance costs. It is also different from landlord insurance, which protects rental properties.
FAQ: Renters Insurance Essentials
How much renters insurance do I need?
Most renters need $25,000 to $50,000 for belongings and at least $100,000 in liability.
Does renters insurance cover roommates?
No, unless they are listed on the policy.
Is pet damage covered?
Injuries may be covered under liability, but damage to the unit usually is not.
What is the cheapest renters insurance?
Some basic plans start at $5 per month, but limits may be low.
Does it cover items outside my home?
Yes, usually up to 10% of your property coverage.
Can landlords require renters insurance?
Yes, in most states.
Are floods or earthquakes covered?
No, separate policies are required.
