To find the best and cheapest renters insurance policy, ask yourself these questions during your search:
1. Determine how much money you can afford to spend.
Decide how much room in your budget you have for renters insurance because that will affect what company you can buy from and how much renters insurance coverage you can get.
There are a few factors that may affect your insurance premium. Most renters pay a monthly premium, which might cost more than an annual premium because the provider adds interest onto the monthly cost. If you can afford to pay $180 upfront, you’ll save money in the long run.
If you’re looking to get your cost down, you can choose a higher deductible. The average deductible is $500 per covered event, but if you choose $1,000 or $2,500, your premium will be lower.
You can also look for companies that offer discounts. The company that provides your auto insurance will likely give you a discount for buying rental insurance through them. Other common discounts include having safety features, like smoke detectors and fire extinguishers, in your home and being claims-free.
2. Decide how much personal property coverage you should get.
Personal property coverage should be tailored to the amount of belongings you have. Take an inventory of all the items in your home and estimate their value. One factor to keep in mind is whether you want an ACV or RCV policy.
If you want your insurance provider to cover the cost of buying a new item if that item is damaged, then estimate your items as if they were new and look for a company with an RCV option. The alternative is estimating your item’s value based on depreciation and purchasing an ACV policy.
Another way to estimate your property’s value is by using a tool that insurance providers like Allstate and Geico offer. This tool breaks down your belongings by room and makes it easier to determine what everything is worth.
Note: Loss of use is often automatically calculated as 20% of your personal property, and most landlords require $100,000 worth of liability, so most of your coverage levels are already determined going in.
3. Look for a company that offers 24/7 customer service.
A covered event could happen at any time, and when it does, you want to make sure you can file a claim right away. The best renters insurance company is one with 24/7 customer service. If another company has the policy you want at the price you can afford, ensure it at least has a claims center that’s open 24/7 or you have a customer portal and mobile app to file a claim yourself.
4. Think about whether or not you live in a state with natural disasters.
If you live in a state like California or Florida that’s vulnerable to natural disasters, you may want to consider a company that provides specific coverage for those events.
Most companies won’t include natural disaster coverage in your base policy, so you’ll likely have to pay extra for an endorsement. If you’re eligible for USAA and want natural disaster coverage, we recommend getting a quote from them since it’s the only company in our review that includes flood and earthquake coverage under all policies.
If you aren’t eligible for a USAA membership, almost all companies offer at least an earthquake add-on that adds $1 to $2 to your monthly premium.