Do You Actually Need Renters Insurance?

Renters insurance is one of the cheapest policies you can buy, often $15 to $30 a month for a typical apartment. It is also one of the most commonly skipped, usually because tenants assume their landlord's insurance covers them. It does not. A landlord's policy covers the building, not your belongings, and not your liability - which is exactly the exposure renters insurance closes.

What renters insurance covers

• Personal property. Furniture, electronics, clothing and appliances you own, against fire, theft, vandalism, and certain water damage.
• Liability. If a guest is injured in your home, or you accidentally damage someone else's property, this pays legal costs and damages.
• Loss of use. If your unit becomes uninhabitable, it pays for temporary housing and related costs.
• Medical payments. Small medical bills for a guest injured in your home, regardless of fault.

What it usually does not cover

Earthquake and flood damage are almost always excluded and need separate policies. High-value items such as jewellery, musical instruments and collectibles often hit per-category limits and need scheduled additions. And ordinary wear and tear is never covered.

Premium ≈ replacement value × rate + liability + peril surcharges − discounts

Replacement cost versus actual cash value

Choose replacement cost coverage. Actual cash value pays what your used belongings are worth today, which for electronics and furniture is a small fraction of what you paid. Replacement cost pays what it costs to buy new equivalents. The premium difference is small, and the payout difference is large.

Do I really need it if my building is safe?

The most common claim is not fire - it is theft and water damage from a neighbour's unit, both of which happen in safe buildings. A burst pipe from the apartment above can destroy a tenant's belongings without any fault of their own, and without renters insurance there is no automatic route to recovery.

Frequently asked questions

Is renters insurance required? Not by law, but many landlords now require it as a lease condition.

Does my roommate's policy cover me? No. Policies cover the named insured and residents listed on the policy. Each unrelated adult generally needs to be on the policy or have their own.

Estimate your own premium with the calculator below.