Insurance is a means of protection from financial loss. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss.
An entity which provides insurance is known as an insurer, insurance company, or insurance carrier. A person or entity who buys insurance is known as an insured or policyholder. The insurance transaction involves the insured assuming a guaranteed and known relatively small loss in the form of payment to the insurer in exchange for the insurer's promise to compensate the insured in the event of a covered loss. The loss may or may not be financial, but it must be reducible to financial terms, and must involve something in which the insured has an insurable interest established by ownership, possession, or preexisting relationship.
The insured receives a contract, called the insurance policy, which details the conditions and circumstances under which the insured will be financially compensated. The amount of money charged by the insurer to the insured for the coverage set forth in the insurance policy is called the premium. If the insured experiences a loss which is potentially covered by the insurance policy, the insured submits a claim to the insurer for processing by a claims adjuster.
Renting an apartment or house does not eliminate the need for insurance. Renters insurance protects your personal belongings from loss or theft and provides liability coverage for you in the event someone is injured while in the living space you are renting. (For more, see 6 Good Reasons To Get Renters Insurance.)
According to the National Association of Insurance Commissioners, renters insurance isn’t prohibitively expensive at about $15 to $30 per month and the protection it affords is well worth the modest cost. Among the many companies that sell renters insurance, reviewers and experts have identified several that offer exceptional coverage and value. (For more, see The Average Cost Of Renters Insurance.)
Allstate
Allstate Corp. (ALL
Allstate Corp
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), one of the best-reviewed renters’ insurance companies, is especially well-known for its exceptional online resources. These resources, including the What’s Your Stuff Worth? tool and Digital Locker app, make determining the value of personal belongings and accounting for them a breeze.
Although Allstate’s premiums can be more expensive than average in some high-risk areas, the company does provide water and sewer damage coverage as part of its renters insurance policy. Allstate also provides great coverage for high-ticket items, such as jewelry.
Liberty Mutual
Liberty Mutual also provides superior online resources, a desirable feature for many renters insurance buyers. Although pricing can be high in some geographic areas, overall the company’s quotes are very competitive. When seeking a quote from Liberty Mutual, the online tool allows you to modify coverage for personal property, identify theft, computers and jewelry, providing a helpful and painless way to determine how much coverage to purchase.
Liberty Mutual is noted for its top-notch computer-and-smartphone coverage endorsement. The live chat feature has been deemed easy and convenient to use.
State Farm
State Farm rates are among the lowest available. The easy-to-use online quote tool allows for adding coverage for things like computers and jewelry as needed. Flexibility is also a hallmark of State Farm’s liability coverage. State Farm provides a range of deductible options, as well as flexibility with the level of liability and medical payment coverage.
One note of caution: water and sewer backup coverage is not included and is not available online. For that you need to speak to a local agent. You can locate an agent through the online portal or by checking Yellowpages.com.
American Family
American Family features lower-than-average premiums, but coverage areas are somewhat limited and you can’t purchase its renters insurance in some parts of the U.S. The website, while helpful, provides an estimate and not a complete quote. Since coverage isn’t available everywhere, you first need to determine if there is an agent in your area. That’s can be easily done on the website by clicking the “Find an Agent” button.
The policies include the availability of extended (floater) coverage on high-value items, such as computers, jewelry, a stamp or coin collection, etc. This is a plus as not all companies offer extended coverage.
Nationwide
Nationwide renters insurance policies are among the most customizable available. In some areas, premiums are much higher than those offered by other companies, so comparison shopping is necessary.
Nationwide does have stricter-than-usual limits for high-ticket items. Many insurance companies will reimburse you up to $5,000 for lost or stolen jewelry and similar items. Nationwide’s limit is $500. You can increase coverage for expensive items – at a higher cost.
Coverage does include the building and additions, which means if there is damage to an exterior hallway or carport that is part of your rental property, Nationwide will reimburse you up to a designated limit.
Farmers
Farmers is one of the more competitive insurers out there. The company’s online quote tool is flexible, especially with regard to liability, medical payment and the deductible part of coverage. However, the tool has limited availability and can only be used in 19 states. Unlike many insurance companies, Farmers does not provide an online chat service, but solid claims management and a very good mobile app help make up for that shortcoming.
Although coverage for jewelry is lower than average, coverage for electronics is exceptional. Overall, Farmers offers very competitive rates, a real plus for most renters. The company’s variable deductible feature is especially worth noting, depending on risk factors in your area.
The Bottom Line
Any of the companies listed here can provide cost-effective renters insurance coverage, provided coverage is available where you live. Remember, it costs nothing to get a quote, and the online quote process is easy with most insurers. In general, the more quotes you can get, the better.
Make sure you obtain sufficient coverage for your belongings and to protect you in the event of an accident on the property you rent. Adjust the deductible to a level that is comfortable and set monthly premiums in an affordable range.
