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Renters Insurance

How Much Renters Insurance Do I Need?

Did you know that your landlord’s insurance policy likely won’t cover your belongings or injuries sustained at your apartment? That’s where Renters insurance comes in. In today’s blog, we answer your questions about Renters insurance, including how much you need.

What is Renters Insurance?

Renters insurance is coverage purchased by an individual who lives in a rental property. Generally speaking, Renters insurance policies tend to cover your personal property, as well as offering personal liability coverage and loss-of-use coverage. Renters insurance only covers certain perils, including things like fire and smoke, vandalism, theft, and wind damage.

What Does Renters Insurance Cover?

Because policies can differ, it’s important to review your Renters insurance policy to better understand what is and isn’t covered. That said, you can break most Renters insurance policies down to three types of coverage: personal property coverage, liability coverage, and loss-of-use coverage.

Personal Property Coverage

In the event that your personal belongings are stolen, damaged, or destroyed by a covered peril, your personal property coverage reimburses you up to your coverage limit.

Liability Coverage

Having liability coverage will protect you if someone is injured on your property and needs medical attention or decides to pursue legal action against you.

Loss-of-Use Coverage

If your rental property becomes unsafe to live in due to a covered peril, loss-of-use coverage will reimburse you for the cost of alternative lodging, like a hotel room or a short-term rental.

Actual Cash Value Vs. Replacement Cost Value

The personal property coverage of your Renters insurance policy will either cover your belongings at actual cash value or replacement cost value. Actual cash value policies reimburse you based on how much the item was worth at the time of loss, factoring in depreciation. Replacement cost insurance policies would reimburse you based on the amount needed to replace a damaged item with one of similar value.

How Much Renters Insurance Do I Need?

It depends. A typical Renters insurance policy averages out to roughly $30,000 of personal property coverage, $100,000 of personal liability coverage, and loss-of-use coverage equal to about 40% of your personal property coverage. That said, there are ways to accurately calculate your Renters insurance needs.

Consider Your Belongings

Creating a thorough home inventory list will give you a much more precise look at how much personal property coverage you need. Depending on the value of your items, you may even want to schedule endorsements for engagement rings, photography equipment, and other big-ticket items.

Consider Your Lifestyle

Certain lifestyle factors could play into how much Renters insurance you need. If you have a dog, for example, you may want to consider a higher liability coverage to protect yourself in the event that your dog bites someone. The same goes for if you tend to host lots of large parties.

Ready to sign up for Renters insurance? Contact an independent insurance agent today to learn more. In the meantime, check out our insurance blog where we cover everything from what you need to know about umbrella insurance to how to prevent package theft.


The content available via Grange.com is for informational purposes only and may not be used for any other purpose. Content provided or expressed on Grange.com, including that of third parties, may not reflect Grange Insurance Association’s (GIA) policies or conform to any agreement you may have with GIA and its subsidiary companies. Please contact a licensed insurance agent to obtain particular advice.

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