Renter’s Insurance: Pros and Cons

30 Sep

Zami student housing

Chris Bibey is the founder of, a website providing personal finance advice from the pros.

No matter if you are renting an apartment as a college student or a single family home as a young professional, you are going to have many financial decisions staring you in the face.

One of the most important questions you have to answer is this: should I purchase renter’s insurance or opt against this coverage for the time being?

Like any sort of insurance policy, you need to compare the pros and cons to ensure that you are making the right choice. Upon doing so, you will have a better idea of how to move forward.


Acer LaptopMost people soon find that the advantages of buying renter’s insurance greatly outweigh any perceived downfalls. Here are several benefits you don’t want to overlook:

  • It is affordable. While home insurance can often times be expensive, this is not the case with a renter’s policy. For approximately $10-$15 per month, you can receive up to $50,000 of personal property coverage. These numbers are rough estimates, but give you a good idea of just how affordable a policy can be.
  • The ability to add liability coverage. In addition to coverage for your personal property, liability protection is a big deal. For instance, if somebody is hurt on your property or your dog decides to bite a neighbor, you will be protected.
  • Plenty of companies offering high quality renter’s insurance. Regardless of where you live, you won’t have a difficult time finding an agent who can provide you with the policy you are looking for. Investigate your current auto or life insurer, they too can have renter’s insurance policies and bundling insurance policies could save you more money.


Generally speaking, there are not many disdvantages of renter’s insurance. However, here are a couple of things to keep in mind:Calculator

  • Deductible. Like any insurance policy, there will be a deductible attached to this coverage. This is the amount you will pay out of your own pocket before your policy kicks in.
  • Another monthly expense. Although renter’s insurance doesn’t cost a lot, this is an expense you have to add to your budget. Can you afford it?

Now that you understand the pros and cons of renter’s insurance, it is time to decide if it is right for you.

If you rent an apartment or home, this is a relatively cheap type of policy that can provide you with personal property and liability protection. Most agree that carrying some sort of coverage would be in their best interest. How do you feel about this?

2 Responses to “Renter’s Insurance: Pros and Cons”

  1. Carol Sutherland October 1, 2013 at 10:28 PM #

    Pros: A personal renters insurance policy is invaluable and generally considered essential. This applies to both students and non-students in all types of rented accommodation, including rooms, apartments, condos, houses and more. With no policy, you face the financial consequences of property loss and damage from many perils, but most critically, fire, vandalism and theft. There is no recourse through the landlord’s insurance. Liability insurance is a standard component of a renters insurance policy. This protects against the financial consequences of being sued for causing damage or loss to person and property. If you accidentally burn down your rental house for example, without a renters insurance policy you could be pursued for substantial damages.

    Cons: A low deductible choice is often available (for increased premium) but some deductible is standard. Actual cash value is the standard settlement approach to claims; this means that in order to obtain the preferred full replacement cost reimbursement approach, you will normally need to take a policy endorsement at added cost. A cost efficient monthly payment plan or option may not be available.

    On balance, renters insurance is considered a must. In fact landlords are increasing requiring it of prospective tenants.


    • MyMoneyPurdue October 14, 2013 at 2:52 PM # Thank you for the comment and for your insight into renter’s insurance.


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