Is Renters Insurance Required? (2024 Guide)
Renters insurance is not legally required, but is often required by your landlord.
If you’re about to rent a new apartment, condo, or home, you’re likely resetting your budget. This may have you wondering—is renters insurance required? Whether or not tenants are required to have an active renters insurance policy depends entirely on the landlord or property management company. Let’s take a closer look at when renters insurance is required and what else you need to know about this policy type.
How To Know if You Need Renters Insurance
Even though renters insurance is not mandated anywhere by state laws—unlike auto policies—this policy type is still often required through landlord or property manager contracts within lease agreements. If renters insurance is a requirement, your landlord or property manager will also inform you of how much coverage they require you to have.
Does Renters Insurance Cover Roommates?
Family members, spouses, and domestic partners are typically covered by your policy. But roommates who aren’t related to you may need their own policy to ensure adequate protection for their personal belongings and liability coverage
For the best protection, having separate policies tailored to your own specific needs and circumstances can help ensure comprehensive coverage for everyone living with you.
If you want coverage for a significant other who is not legally part of your family, we recommend getting a quote from Lemonade because they allow you to add your significant other (and their belongings) to your policy for less than $2 per month.
How Much Renters Insurance Coverage is Required?
If you must have a renters insurance policy to meet the terms of your lease, your lease contract will outline how much coverage you need to secure. Landlords stipulate minimum coverage amounts to ensure adequate protection for both the tenant and the property in the event of unforeseen incidents like fire, theft, or liability claims.
While there’s no hard and fast rule stating how much renters insurance a landlord should require, typical amounts tend to range from $25,000 to $50,000 for personal property coverage, along with liability coverage of $100,000 or more. However, renters need to assess their individual needs beyond the minimum requirements.
Consider the worth of your personal belongings and additional riders before choosing coverage types and amounts. Not all insurers will allow you this much flexibility, so you’ll need to research which insurer can offer you the types and amount of coverage you’re looking for. Take your time finding the best renters insurance company for your needs. Remember—the goal isn’t to find the cheapest renters insurance coverage, but the right coverage.
Is Renters Insurance Worth the Cost?
Since it’s a budget-friendly policy and can help prevent financial setbacks when disaster or theft strikes, renters insurance is almost always worth the cost. Even if renters insurance isn’t a requirement in your lease agreement, Bonnie J. Walker, AIC, CLX Technical Lead, Property at Lemonade, warns against skipping out on this policy type. “Unless you’re living with a resident relative who has their own policy, usually mom and dad, you need renters insurance,” Walker says.
Walker goes on to explain that if you’re living in an apartment complex, you’re subject to the carelessness of the other renters in your building. Without a policy, you would have no coverage for your damaged items, nor would you have loss of use coverage if you needed to stay in temporary housing while the damages are being repaired. “You would also leave yourself open for litigation if you caused a loss that damaged other units, or caused any injury to a third party,” Walker warns.
To recap, these are a few reasons why renters insurance is often worth having:
- Protection for personal belongings against theft, fire, vandalism, and other covered perils
- Liability coverage for accidents that occur within the rented property, potentially saving tenants from costly legal expenses
- Coverage for additional living expenses if the rented property becomes uninhabitable due to a covered event
Frequently Asked Questions About Renters Insurance Requirements
Why do some people not get renters insurance?
If it isn’t required, some renters may choose to not get a renters insurance policy to save money, although they’re at risk of being on the hook for 100% of the costs if something goes wrong. Remember that renters insurance policies are typically low-cost compared to other types of policies. How much is renters insurance? This policy type usually costs $15 to $30 per month and can come in handy in the event your personal belongings are damaged or stolen, or if you become liable to another party for injury or losses.
Is renters insurance required in some states?
No state mandates landlords or property management companies to require their tenants to hold an active renters insurance policy. That said, many landlords and management companies require this type of insurance policy as part of their lease agreements.
How important is renters insurance?
Having renters insurance is extremely important if you want to protect yourself financially. Having your belongings stolen or damaged, facing liability, and dealing with other major financial disasters can be a lot less stressful if you have a good renters insurance policy by your side.
How do I know if I need renters insurance?
If your property management company or landlord requires you to have a renters insurance policy, they will inform you during the lease signing process. Read your lease agreement thoroughly to find out if renters insurance is a requirement and how much coverage you must obtain and maintain to meet the terms of the lease agreement.
