Renter’s insurance is very reasonably priced for the protection that you, as the insured, receive from the policy. It can run from under $100 per year to over $500, depending on your coverage and factors. The average price is between $150 and $180 per year, as explained below.
How much your actual policy costs is a function of many different factors. These include:
- The amount of maximum coverage you carry
- The type of coverage and any special coverages
- The zip code you live in, based on past claims the carrier has on record for theft and other claims in that area
- Theft and/or fire deterrent systems in the property or building
- The deductible that you select for the policy you buy
- Any discounts for multiple polices with the same insurance company, like having both renter’s insurance and automobile insurance with the same company
- Your past insurance claims history, if you have prior claims
- Your credit report and score may also be a factor in some states
Minimum Policy – The bare minimum policy for people who do not have a lot of property might be a policy with a maximum coverage amount of $12,000 for personal property, a $500 deductible, and liability coverage of $100,000. A policy like this would cost under $100 per year at many carriers, according to Cathy Baum of Allstate Insurance in Poway, Calif.
Average Policy – An average policy for someone who has accumulated more property might be a policy with a maximum coverage amount of $25,000 for personal property, a $500 deductible, and liability coverage of $100,000. A policy like this would cost in the neighborhood of $120 to $180 per year.
More Comprehensive Coverage – More comprehensive coverage is available if you are wealthier with more personal property, or desire additional liability coverage. The premium can go up to $500 or even $1,000,based on how much coverage you would need and purchase.
You might want personal property coverage for hundreds of thousands of dollars if you have artwork, collectibles, or expensive furniture. A $100,000 maximum personal property coverage limit policy would cost $250 to $350 per year.
In general, for each additional $10,000 personal property maximum policy coverage you carry, your premium might increase by $15 to $20. However, keep in mind that this is just a general estimate because premiums can vary based on all the factors described above.
You might also want to raise your liability coverage from $100,000 to $300,000 or even $1,300,000, depending on your circumstances. Increasing your liability coverage by $1,000,000 might increase your insurance costs by $350 to $500 per year – called an Umbrella policy. You would want additional liability coverage if you have significant net worth. This way, if you were sued, the insurance company would step in, defend you, and pay any settlement or judgment up to your policy limits. Therefore, you would not have to pay as the coverage protects your net worth. As such, if you are a wealthier individual, you need to discuss how much coverage you should carry with your insurance professional and they can determine a policy premium for you after considering your coverage needs and factors.
The amount of coverage you carry is your decision, and is typically determined by the value of your property and the risk you are willing to take with respect to liability protection. The best way to ensure you have the proper type and amount of coverage in place is to determine exactly what you believe you need and then sit down with a couple of insurance providers and let them price out a policy for you. Then, you can purchase the policy that you believe is the best option for your personal circumstance.