Best renters’ insurance companies

Lemonade is different from traditional insurance companies. While they provide homeowner’s and renters insurance coverage, they also make contributions to charities.

Lemonade Renters Insurance

Lemonade's affordable Renters Insurance includes personal property, personal liability, medical payments and loss of use coverage, as well as coverage for laptops, phones, tablets and other personal electronics (for named perils only). It’s easy to get a quote and apply to purchase coverage online in just a few minutes.

Pros:

• Affordable policies
• Online quotes
• Discount and bundling options

Cons:

• Not available everywhere
• Doesn’t offer many add-ons

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In fact, the company is a Public Benefit Corporation and a Certified B-Corp.

When you choose your Lemonade policy, you also select a nonprofit cause you want to support. Once a year, the company adds up unclaimed money left from you and other customers and gives that back to the nonprofits. Up to 40% of your premium could go to the cause of your choice.

Lemonade Renters Insurance provides coverage on:

• Liability
• Personal property anywhere in the world
• Fine art and jewelry
• Theft
• Fire
• Explosion
• Vandalism
• Reimbursed living expenses
• Electronics and peripheral equipment

One of the major disadvantages of Lemonade is its limited availability. It’s available in just 22 states, plus the District of Columbia. Those states include Arizona, Colorado, Connecticut, Georgia, Illinois, Indiana, Iowa, Maryland, Massachusetts, Michigan, Missouri, Nevada, New Jersey, New York, Ohio, Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Virginia, and Wisconsin.

» Open a renters policy with Lemonade or read our full Lemonade Insurance review.

Policygenius isn’t a renters insurance company, instead, it is an independent online insurance broker that allows you to shop for renters insurance across several companies. Best of all, you only need to fill out a single application to apply with multiple companies.

They also offer you an opportunity to apply for several different insurance policy types at the same time. That includes life insurance, auto insurance, and even health insurance.

Once you complete the application—which you can do online and in a matter of minutes—you’ll receive an email from a Policygenius licensed insurance expert within 24 hours. You’ll receive your quotes within 48 hours. From there you’ll be redirected to the website of the insurance company of your choice, where you can complete the application process.

» Open a renters policy with Policygenius or read our full Policygenius review.

Allstate is one of the largest and best-known insurance companies, especially when it comes to renters insurance.

But one of the reasons Allstate is so well known is because they have a large network of insurance agents to help you through the process. Having an experienced agent walk you through the process will not only save you money,but also make sure you get the right renters insurance coverage.

Still, another advantage the company has is that the website is a strong educational resource. You can learn as much as you want about any type of coverage.

» Open a renters policy with Allstate

Also great

USAA started out as an automobile insurance company for members of the U.S. military. But it branched out and now provides virtually all types of insurance coverage, including renters insurance.

One of the major advantages to working with USAA is the volume of financial products they offer to military families. In addition to insurance policies, they also provide banking services, credit cards, auto loans and mortgages, mutual funds and other investments, retirement plans, and shopping and discount offers.

There’s one area of renters insurance where USAA stands out above the rest. Your policy coverage includes flood insurance. With virtually every other insurance company, flood insurance is considered a separate policy.That’s true whether it’s a renters policy or a homeowners insurance policy.

» Open a renters policy with USAA

Liberty Mutual is another of the largest insurance companies in the country. They provide renters insurance in virtually all markets, and are especially well known for their auto insurance policies.

Liberty Mutual

Liberty Mutual is an insurance company that has been around for over 100 years and has consistently marketed themselves as an insurer that really cares. In fact, one of their main slogans is: “we believe insurance should ease your concerns, not cause them.”

Liberty Mutual offers a big selection of policies, including home, renters, auto, life (term and whole life), flood, business, accident, and pet insurance.

Pros:

• Lots and lots of discounts
• Make a claim in minutes
• Fast quotes

Cons:

• Not the best customer service reviews
• Not all coverage is available in every state

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Liberty Mutual is the most expensive renters insurance provider on our list, but it offers a wide variety of discounts, particularly if you’re a member of certain organizations, such as alumni associations.

They tend to offer coverage in high risk situations or geographic locations that other insurance companies might avoid. It also offers solid computer and smartphone coverage endorsements, which have become increasingly important in today’s world.

» Open a renters policy with Liberty Mutual or read our full Liberty Mutual review

State Farm

State Far is America’s largest insurance company and you’ve probably heard of Jake from State Farm. State Farm offers almost every type of insurance you might need, including renters.

You may prefer State Farm if you’re already using one of their other insurances and want everything all in one place. Some ways to save on renters with State Farm include bundling, increased protection on your home, and going with a higher deductibles to lower your monthly premium.

» Start a quote with State Farm

Renters insurance is a specific type of policy that covers the contents of the property you’re renting. This is very different than homeowner’s insurance, which not only covers your contents, but also insures the building itself.

Renters insurance covers two broad categories: personal property and liability.

Personal property is the contents of your apartment or rental home. Liability provides coverage in case someone is injured inside your home, is bitten by your dog, or you are sued by another party for some reason related to your rental space.

A disaster could happen

The simplest answer is that if you don’t have renters insurance, you’ll have no protection against any form of disaster or personal liability.

Your landlord undoubtedly has insurance coverage on the property and building. But that’s only for the physical structure. It does not extend to any of your personal contents.

That means if the property were destroyed in a fire, the landlord would be able to recover under homeowner’s policy for the destruction of the building, but any of your personal property destroyed in the same fire will not be covered.

Liability coverage

There’s also the matter of liability coverage. If someone is injured inside your home, or bitten by your dog, you’ll be liable to cover medical expenses at a minimum. And if that person chooses to sue you for damages as a result of the injury, your renters insurance would cover the liability.

Absent a good renters insurance policy, you would have to pay out-of-pocket for any of those expenses.

Your landlord may require it

One final and significant reason why you may need renters insurance is because many landlords require you to have it. It’s typically written into the lease.

More than anything, it depends on the value of your personal possessions. Most insurance companies have a set minimum, which could be $20,000, $25,000, or $30,000.

Those are reasonable estimates, especially for an apartment. But if you’re renting a house, or you have significantly more possessions, you’ll need more coverage.

The best strategy is to do an inventory of your possessions. Most insurance companies have an online tool that will help you with both the inventory and the itemized valuations.

The liability portion of a renters policy is more difficult to estimate. Once again, most companies have a minimum amount, which might be $100,000. But there’s usually not a big difference in premium for increasing the liability insurance portion to $200,000, or even $300,000. And when it comes to liability coverage, more is better.

There are some differences in renters insurance policies from one insurance company to another. But typical coverage includes:

• Damage caused by natural disasters, like fire and storms.
• Theft of property.
• Damage from vandalism.
• Water damage caused by housing components (i.e., hot water heater or burst pipes).
• Property contents, including furniture, clothing, and personal possessions.
• High value property, such as computers and jewelry, but only up to a certain dollar limit.
• Many policies also provide coverage for personal possessions stored off the property.
• Reimbursement for living expenses due to loss of use of the rental property.

Liability coverage includes:

• Medical bills for anyone who is injured inside the home.
• Injuries caused by your pets.
• Coverage for lawsuits brought as a result of either of the above.

If there is any property or hazards not specifically listed in your policy that you want covered, you can usually add them at a higher premium rate.

Let’s start with this: If a hazard isn’t specifically listed in your renters insurance policy, it isn’t covered.

That makes a strong case for doing a thorough review of your policy before accepting it. An insurance policy is really a contract. It’s spells out specific details of what will or won’t be covered. You need to be aware of both.

Typical renters insurance policy exclusions include:

• Lost possessions, not as a result of theft.
• Damage caused to the property either by you or your pet.
• High value possessions that exceed the dollar value of coverage set for those items.
• Damage as a result of floods (though USAA does cover this hazard).
• Damage as a result of earthquakes.
• Property owned by a roommate who is not listed on the policy.
• Damage from terrorism or war.
• Damage caused by pests, such as insects or rodents.

Policy deductible

As listed above, you’ll want to carefully evaluate what is and isn’t covered in your policy. Next is the policy deductible. This is the amount you’ll have to pay out-of-pocket before the coverage applies.

A $500 deductible will have a higher premium than a $1,000 deductible.

Policy riders

If you have any items or hazards not covered by the policy, see what policy riders are available. For example, if your policy only covers up to $1,000 for computer equipment, and yours is valued at $5,000, you’ll want a rider providing additional coverage.

If you live in an area subject to either flooding or earthquakes, you may want to add a separate policy to cover either hazard.

Discounts

Also, consider any discounts that are offered. Bundling is a common discount, which might make getting renters insurance from your auto insurance provides a cost-effective strategy.

Reputation of the insurance company

Finally, consider the reputation of the insurance company. Check the strength of the company with A.M. Best, the insurance industry rating service.

Also, investigate customer reviews of the company, focusing closely on customer service and especially on any complaints about payment of claims.

Replacement cost coverage (RCC) vs. actual cash value (ACV)

This mysterious provision is one of the most important in a renters insurance policy. RCC reimburses you for the value of stolen or damaged possessions based on the current market value. It has a higher level of coverage, since it will enable you to fully replace lost contents at current prices.

ACV will reimburse you based on depreciated value. For example, if you purchased a TV five years ago for $500, and it’s stolen or destroyed, the insurance company may pay only $100.

Naturally, RCC will be more expensive, since it provides superior coverage. But it’s well worth paying a little extra for.

As is the case with all insurance policies, renters insurance premiums are determined by a matrix of factors, including:

• Property location.
• The value of your contents.
• The amount of liability coverage you include.
• Any policy riders you need for additional coverage levels.
• The type of property (single family detached home, condo, garden apartment, high-rise apartment, or 2-4 family home).
• Your credit history.
• Your claims history.
• Replacement cost coverage or actual cash value (as described above).
• The amount of your deductible.
• Discounts available.
• If you have a home-based business.
• The number of people who live in the home.
• Pets in the home.
• Payment method (annual is usually less expensive than monthly payments).

When shopping for anything as important as renters insurance, it’s always best to investigate several sources.

Check with the providers on our list above

We’ve prepared this list because we believe these represent six of the very best renters insurance companies in most markets in the country.

Connect with a local insurance broker

There are insurance agents and insurance brokers, and there’s a major difference between the two. In most cases, an insurance agent represents just one company. The limitation is that he or she will do everything possible to get you into a policy available with that company. It may not be the best coverage available, or the least expensive.

A broker is independent and represents several insurance companies. He or she can help you to locate the best coverage at the most affordable premium. They can explain all of the provisions, any riders you want, and handle the entire application process.

What’s more, they can also assist with service issues once the policy is in place. And if a better policy becomes available, they can move you into it.

Get an online quote

You’ve probably noticed the overwhelming number of online insurance websites available.  These are frequently referred to as insurance aggregators because many different insurance companies participate on the sites.

This can be a real opportunity to get the least expensive coverage available. But there are also serious limitations with insurance aggregators:

• They advertise their best prices, which may not apply in your case.
• Not all companies are available in your market.
• You can be solicited by the dozens of companies at once, complicating your decision.
• Insurance aggregators collect your information for marketing purposes; you may find yourself being solicited by insurance companies months after you’ve chosen a policy.

Tread lightly with this one.