How to Save Money on Renter’s Insurance: Average Cost, How to Compare, and More

Insurance is something everyone knows a little about, but few people understand. It’s no surprise that this is the case since insurance is something that most people hope they never have to use. 

This is especially true when you’re renting. You hope that your landlord has you covered, but unfortunately, this is rarely the case. 

Renter’s insurance can be confusing. After all, why should you pay to take cover something you don’t own? With the price of rent at an all-time high, many people are looking for ways to tighten up their budgets. 

Should you drop your renter’s insurance to save some money? Is renter’s insurance required? And why should you even bother with renter’s insurance? Let’s take a quick look at these questions so you can make the best decision for your home (even on a strict budget). 

Photo by Luke van Zyl on Unsplash

Insurance Law – Is Renter’s Insurance Required?

It’s a good question. Is renter’s insurance required by law? Federal law requires all drivers to have some kind of auto insurance coverage, but homeowner’s insurance isn’t required. 

So what about renter’s insurance? The short answer is: No, renter’s insurance is not legally required. There is a longer version of this answer, though.

While the government doesn’t require renter’s insurance, many landlords do. It is legally acceptable for a landlord to require renter’s insurance. As many as 84% of landlords require renter’s insurance, making a landlord that doesn’t require it the exception, not the rule. 

Even if your landlord doesn’t require renter’s insurance, you aren’t necessarily good to go. 

Is renter’s insurance required? No. Does that mean it’s unnecessary? Absolutely not

There are two main reasons to get renter’s insurance: damage to your home and damage to your neighbor’s home. Natural disasters and theft can damage your home, and you’d have to pay out of pocket to repair or replace your things and your home.

If you live in an apartment complex, you also have to think about your neighbors. Natural disasters and theft aren’t the only things that can cause damage. You might have a tub overflow, a grease fire that causes damage to more than one unit, or other accidents. These accidents can damage not only your apartment but your neighbors’, as well. 

Landlords don’t always have their own coverage for the building, and will likely require you to pay out of pocket for the damage. That means paying out of pocket to repair and replace your own things and your neighbors’, which is much more expensive than buying renter’s insurance!

Renter’s Insurance Average Cost – What can I expect to pay?

Paying out of pocket is almost always more expensive than insurance, but how much is renter’s insurance? Average cost for a renter’s insurance policy will vary, but even high-end policies tend to be around $30- $35 a month. 

Just like auto insurance or health insurance, the amount you pay will vary based on a number of factors. Remember: cheaper insurance policies typically have less coverage. 

When you’re choosing a renter’s insurance policy, there are a few things you’ll want to keep in mind. 

First, you’ll need to know how much the policy covers in damages. Basically, this is the amount that you’ll be paid when you file a claim. If you have a policy with very little coverage and an accident occurs, you’ll be paying a bit out of pocket still. Choosing a low-coverage plan is fine, but you’ll want to make sure you’re saving money so you don’t get caught off guard.

Next, you’ll need to know what kind of damages the policy covers. Some don’t cover preventable accidents, for instance, while others might not offer much protection for natural disasters or theft. 

Many people think they don’t need to worry about theft coverage. After all, it’s not like you have diamonds lying around, right? While that may be true, replacing items in your home still isn’t cheap. Don’t believe us? Grab a pen and notebook and start writing down how much it would cost to replace just a few key items – like your TV, microwave, couch, or mattress. Chances are that theft insurance will start to seem much more worth it!

Finally, you’ll need to know how easy it is to file a claim and how likely that claim is to be rejected. Some insurance companies have confusing processes or difficult-to-reach support. These companies make filing a claim difficult to discourage users from filing claims. 

Here at Millenial Dollar, we believe that you should always get what you pay for, so make sure you can file that claim! 

While we’re on the subject of claims, check out some reviews for your insurance company to make sure they aren’t in the habit of rejecting claims. Some companies will reject claims and leave you fighting to get the coverage you were promised. 

Insurance companies can’t legally deny you reimbursement forever, but the lengthy process of arguing about a claim leads people to give up. That kind of stress is the last thing you need when you’re dealing with an accident, natural disaster, or theft. A quick check of the company’s history now can save you a world of headaches later.

Photo by Kostiantyn Li on Unsplash

Saving Money – Where can I get cheap renter’s insurance?

“Where can I get cheap renter’s insurance?” It’s a tough question. Cheaper policies often have less coverage, while expensive policies might be out of your budget. The trick to finding a renter’s insurance policy that’s right for you is balancing cost and coverage. 

You can usually find this balance by looking for discounts. A great place to start is your current auto or motorcycle insurance provider. Most big-name insurance providers offer substantial discounts for bundling. This makes your current provider the best place to start comparing. 

Another option is the growing number of insurance technology start-ups. These start-ups can provide lower prices with outstanding coverage. This is because they only insure one thing, unlike the large providers who can help cover everything.

Whether you go big or small, the choice of an insurance company is important. You need to find someone who can help you in case of an emergency without hurting your budget. With that balance in mind, here are our three picks for renter’s insurance – cheapest, friendliest, most flexible options for the modern renter. 


Our readers who hate thinking about insurance will love Lemonade. They call themselves “Insurance Built For the 21st Century”, and we’re inclined to agree. Signing up takes just a few minutes and filing a claim takes seconds. 

Lemonade was Business Insider’s top pick for best renter’s insurance in 2022, due to its great coverage, easy-to-use interface, and high customer satisfaction. Their prices start at just $5/mo, and you can customize your coverage. 

You can reach customer service anytime, but only through their chat function. There’s no phone number for Lemonade, but we barely consider that a con. (Who likes talking on the phone these days?)

Some of the cons we found with Lemonade were:

  • Not available in all states
  • Flood insurance is an add-on, not built-in
  • No bundling discount


Unsure about entrusting your home to a start-up? Check out Toggle. They were created as a branch of the Farmers Insurance Group, which has been providing insurance for nearly a century. Toggle is a streamlined way to get renter’s insurance, and it’s the most customizable option on the market. 

With Toggle, you choose exactly what you want coverage for so you’re never paying for services you don’t need. They even have an “all peril” option that allows you complete coverage from natural disasters. (Great for our coastal readers!)

One of the unique things we love about Toggle is its credit-building feature. Anyone working on their credit score knows just how difficult it is to get that number up, and Toggle lets you boost your credit score just by paying rent on time.

Like Lemonade, Toggle’s support can be easily reached via online chat, but there’s no phone option.

Some of the cons we found are: 

  • Not available in all states
  • No bundling discount
  • Higher coverage makes this one of the more expensive options


Do you prefer to do things the “old-fashioned way”, talking on the phone and trusting your coverage to a well-established company? Look no further! Amica has renter’s insurance starting at just $4 a month.

This insurance company has been around since 1907, more than a hundred years, and continues to be a favorite among its users. They’ve won awards for best customer service, best overall insurance, and have an “Excellent” rating on Trustpilot.

Unlike our other picks, Amica doesn’t just do renter’s insurance. You can get renter’s, auto, life, and retirement insurance through Amica and they do offer bundling discounts. 

Cons of choosing Amica include:

  • Most discounts require you to be with the company for several years
  • Not available in all states
  • Policy coverage is unclear before you buy
Photo by FilterGrade on Unsplash

Peace of Mind for Renters

Insurance is is like a lifeboat – you don’t need it until you really need it. The Titanic didn’t have the correct number of lifeboats because the president of the cruise line thought it would ruin the view. To him, extra lifeboats were just an inconvenience, but we all know what happened on the Titanic. 

Insurance is the same way. Right now, it can seem like an unnecessary expense. When you’re working on tightening up your budget, it can be tempting to throw renter’s insurance overboard, but your policy is worth hanging on to. Should anything happen to your home, you’ll be thrilled to have any coverage.

When you’re working with a tight budget, remember that emergencies are much more expensive than a little protection now. 

When you’re looking for a financial edge, don’t compromise your coverage. Instead, find a policy that works for you and check out our newsletter for less risky tips on strengthening your financial future.



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