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What is the Cost of Renters Insurance

Renters Insurance

You need to be sure your renter’s insurance plan is the best one for you since it can vary from state to state. The average cost of renting a home in the United States ranges anywhere between $11 and $21 per month – not including any claims that may take place during those months. Follow along as look at renters insurance costs by state, costs by coverage point, what determines the cost, and more in our article below.

Cost of Renters Insurance By State

Renter’s insurance rates in North Dakota and South Dakota are the cheapest, at $126 a year on average. The state with the most expensive renters’ insurance is Mississippi, where residents pay an average of $252 annually or 73% more than Americans as a whole. 

States with the Cheapest Renters Insurance 

  1. North Dakota: $126
  2. South Dakota: $127
  3. Minnesota: $140
  4. Wisconsin: $143
  5. Iowa: $144

States with the Most Expensive Renters Insurance 

  1. Mississippi: $252
  2. Oklahoma: $236
  3. Louisiana: $234
  4. Texas: $225
  5. Alabama: $222

The top five states with the highest expense are all southern states due to their regions being prone to hurricanes and other forms of extreme weather. 

Cost of Renters Insurance By Coverage Amount 

The worth of your belongings is important when deciding the amount you need for renters insurance. Such items could include televisions, furniture, mattresses, and musical instruments, among other necessary things to live comfortably in a home. 

When it comes to renters insurance, you’ll have a lot of decisions and considerations. Not only will the amount of coverage at stake be up for debate but so is how much personal property protection each person needs or wants. It’s worth looking at some examples to help illustrate the different amounts that people typically carry in their homes. One of the lowest examples would be covered at $13,999 and under. The average annual renter’s insurance cost would be $135, with an average monthly cost of $11. Coverage towards the middle at $38,000 – $43,999 would have an average annual cost of $202 with an average monthly cost of $17. Then, a higher coverage amount of $100,000-$99,999 would have an average annual cost of $422 with an average monthly cost of $35. 

States with the Most Renter Occupied Housing Units

Renting is more prevalent in New York than it is anywhere else. The state has the highest percentage of renter-occupied housing units, at nearly 2/3rds! This stands in stark contrast to states like Maine, where only 27% are rented out.

Just behind New York is California with 5,889,696 occupied housing units at 45.2%, Nevada with a unit of 479,997 at 43.7%, and Hawaii with a unit rate of 189,047at 41.1%. States with the highest numbers of renters tend to have prices that top the national average costs. 

How Average Rent Prices Have Been Affected by COVID-19 

Though the COVID-19 pandemic has significantly impacted rent prices throughout the country, it is not all bad news. Some states are experiencing lower rates of cost for 1 bedroom apartments than they were before, and that’s good to know for those looking into renting an apartment in these areas.

We’ve seen an overall decrease in rent for the first time ever, and while we tend to see a spike during this season, it’s still nice to know that things are leveling out. But outside of these major cities, rental rates have been steadily rising with no signs of letting up anytime soon.

It might sound like a good idea to move from the city for some peace and quiet, but this nationwide change in rental rates is difficult to attribute. Statistics show that renters are leaving cities for the suburbs since the COVID-19 pandemic began. Since then, we have seen an increase of 10% more available apartments now available in suburban areas. 

Determining the Cost of Renters Insurance 

The cost of insurance varies depending on the location and policy details., however, there can be other factors that play a part including: 

  • A person’s claim history and credit score. It’s essential to keep your renters insurance claim history up-to-date with correct and accurate information. A CLUE report gives an overview of the claims you’ve filed for property damage or theft, so any mistakes must be corrected ASAP. An insurer could also want to review your credit score, which could factor into the cost. 
  • Environmental risks and Crime Statistics of Your Local Area. It’s important to remember that insurers will consider where you live, especially if it’s an area of high crime and disaster risks. 
  • The level of your deductible and coverage. A lower deductible means a higher rate. Adding further coverage will increase your rates more. 

What is Covered By Renters Insurance? 

Policies for renters insurance provide four essential coverages: personal property, medical payments for others, personal liability, and loss of use. Policies also include an inflation rider that protects the value of your belongings should they rise over time.

Personal Property: Personal property coverage protects any personal belongings from a laptop to clothes. If something in your home is damaged, like if there’s a fire and it damages the couch, then personal property can help cover for what was lost. But make sure not to forget about certain high-value items too – the same amount of coverage doesn’t always cover jewelry as other things. 

Personal Liability: Personal liability coverage is a wise investment that will pay out if you are ever in court for accidentally injuring someone or damaging their property, and some policies start at $50,000 of coverage. Still, most people opt to get more, with the average being around $100k worth of protection.

Medical Payments for Others: You need a guest to get injured in your home, and you would like some peace of mind? We can help. We will cover medical bills up to $5,000 if someone slips on the stairs or falls down at your house with this coverage.

Loss of Use: Loss of use coverage offers financial relief in the event that you are unable to reside at or visit your home due to damage. This form of insurance will help cover any additional living expenses incurred as a result, such as temporary housing and transportation costs, among others.

What Does Renters Insurance Protect Against?

Insurance is meant to provide protection in the event of a personal injury or property damage, but there are some cases that many insurance policies don’t cover. You should get a clear understanding of what renters insurance will cover and what it won’t cover. 

The standard inclusions in renters insurance coverage include the following:

  • fire and smoke damage
  • Lighting, windstorms, and hail 
  • Theft and vandalism
  • Certain water damages

Types of issues you will see excluded include: 

  • Flood
  • Earthquake
  • Pest damage
  • Sinkholes

Are You In Need of Renters Insurance? 

You may not be required by law to purchase renters insurance, but many landlords do require it as a condition of tenancy. The good news is that Renters Insurance provides great value and is worth purchasing for most tenants – we strongly recommend you buy yours today. 

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