How much renters’ insurance should a landlord require in 2022?

For many landlords, requiring a tenant to obtain renters’ insurance is a standard business practice. Tenants can and will have accidents in a rental property, and renters’ insurance can help protect a landlord against claims made by a tenant or their guests.

In this article, we’ll explain what renters’ insurance covers, the difference between landlord and renters’ insurance, and how much renters’ insurance some landlords require.

Key Takeaways

  • Renters’ insurance is purchased by tenants to provide coverage for personal property, liability, and additional living expenses.
  • In most states, a landlord can require a tenant to purchase renters’ insurance.
  • Average cost of an annual renters’ insurance policy is less than $20 per month.
  • Tenant renters’ insurance may also help to protect a landlord from liability claims arising from a tenant’s guest or injuries or damage caused by a tenant’s pet.



What is renters’ insurance?

Renters’ insurance is a policy that protects tenants. 

Sometimes also referred to as tenant insurance, renters’ insurance generally provides three types of coverage:

Personal Property

Renters’ insurance covers personal property like clothing, electronics, furniture, and other personal property belonging to the tenant that is damaged or stolen, up to the coverage limit of the renters’ insurance policy.


Medical bills of a guest may be paid by renters’ insurance, if the tenant is found responsible for a guest’s injuries or if the tenant accidentally damages property belonging to a guest, it can also cover personal property.

Additional Living Expenses

If the rental unit becomes temporarily uninhabitable, renters’ insurance may cover the hotel bill or costs of other lodging. This coverage may not be available if there is structural damage to the property.   


Renters’ insurance vs. landlord insurance

Some tenants believe that the landlord’s homeowners insurance will protect the tenant’s personal property, but that isn’t the case.

Landlord insurance covers the home itself but usually not the contents that belong to a tenant. On the other hand, renters’ insurance covers the tenant for loss of personal property inside the home, but not for damage to the home itself.

Both renters’ insurance and landlord insurance include liability coverage to pay for medical payments if someone is injured on the property and there is no party found to be at fault. 

Sometimes insurance policies also have overlapping coverage. For example, if someone slips on an oil stain on the driveway and insures themselves, both parties could be held responsible even if the tenant is responsible for keeping the driveway clean.


How much renters’ insurance is enough?

According to, Many landlords require tenants to purchase a renters’ insurance policy with a minimum coverage of between $100,000 and $300,000. 

The more coverage a tenant has, the less potential risk there is for a landlord. For example, a guest of the tenant could be injured and decide to sue both the tenant and the landlord, or the tenant might be the victim of a burglary and become unable to pay the rent because clothing and other items need to be replaced.

However, some state landlord-tenant laws may place a limit on the amount of coverage a landlord is allowed to require. So be sure to check with your property manager or real estate attorney before requiring a certain amount of coverage from the tenant.

Factors to Consider

State Farm recommends considering the following factors to determine the correct amount of renters’ insurance:

  1. Take a complete inventory of possessions: Make a list and determine the replacement value of items and personal possessions in the kitchen and dining room, living room, bedrooms and bathrooms, laundry room, and garage/basement/attic.
  2. Ask about insurance premium discounts: Many insurance companies offer discounts for having more than one policy. Tenants may be able to save money on the cost of renters’ insurance by speaking with their auto insurance company about a renters’ insurance policy.
  3. Select the right deductible: A deductible is the amount of money a tenant will pay out of pocket before receiving any payout from a renters’ insurance policy. If a tenant suffers a loss of $500 and the deductible is $1,000, the tenant will not receive any money from the insurance company. The higher the deductible is, the lower the premium for renters’ insurance is, and vice versa. 

Reimbursement and Exclusions

Renters’ insurance policies reimburse a tenant for a personal property claim filed based on “cash value” or “full replacement cost”:

  • Cash value reimburses the tenant for the depreciated value of an item that is stolen or damaged. For example, if a television that is three years old is stolen, the renters’ insurance policy will pay less than the original cost of the television because the value has depreciated.
  • Full replacement cost pays for the full amount of an item covered. If a three-year-old television is stolen, the renters’ insurance policy will pay for the cost of replacing a similar television at today’s price.

A standard renters’ insurance policy also contains coverage limits and exclusions to perils. 

For example, a policy may limit the dollar amount of coverage per jewelry or electronics, or may not cover some items at all. Normally, a tenant can purchase additional coverage for extra protection if the value of personal items exceed the coverage limits of a renters' insurance policy.

Most standard renters’ insurance policies also do not cover losses or damage caused by:

  • Intentional acts or negligence by the tenant
  • Flood damage
  • Mold and rust
  • Earthquakes and nuclear hazards
  • Acts of war
  • Government action


Typical costs of renters’ insurance

According to a recent article on ValuePenguin, the average cost of renters’ insurance is about $19 per month for personal property coverage up to $25,000 and personal liability coverage up to $100,000. Deductibles average between $500 and $1,000. 

The article also notes that the cost of renters’ insurance can vary significantly from state to state. 

The most expensive states for renter’s insurance are Louisiana, Michigan, and Arkansas, where monthly premiums for renters’ insurance average between $37 and $30. By comparison, the most affordable states for renters’ insurance in the U.S. are New Hampshire, Utah, and Wyoming, where the average cost of renters’ insurance is $12 per month.

Both ValuePenguin and provide ways to search for the cost of renters’ insurance by city and state, and offer quotes for a renters’ insurance policy online.


Can a landlord require renters’ insurance?

In most states, a landlord can require a tenant to have renters’ insurance. 

Many landlords will require that both the landlord and property manager be listed as an additional insured on the tenant’s renters’ insurance policy. The tenant can also normally be required to provide proof that a renters’ insurance policy was purchased and that the policy is active.

There are several reasons why a landlord may require a tenant to have renters’ insurance:

  • Avoid paying for or replacing personal property of the tenant damaged or destroyed by a flood or other natural disaster.
  • Help to eliminate the tenant’s excuse for not paying the rent because money needs to be used to replace damaged or stolen possessions.
  • Reduce the landlord’s liability risk if a guest of the tenant is injured on the property, such as the guest slipping and falling on the front porch.
  • Minimizes the risk of renting to a tenant with pets when renters’ insurance covers dog bites or damage to the rental property.
  • Avoid paying for a hotel room if the tenant is temporarily displaced due to the home being uninhabitable for a short period of time.
  • Sometimes the landlord’s insurance company will request that the tenant obtain renters’ insurance, to help reduce the potential claims from the landlord and to provide a lower landlord insurance premium.
  • Requiring the tenant to purchase renters’ insurance can also be a good way to screen out bad tenants because if the applicant can’t afford a renters’ insurance premium of $20 or so each month, the tenant may also have trouble paying the rent.


renters insurance policy on clipboard

Optional coverage with renters’ insurance

Most standard renters’ insurance policies provide coverage for personal property, liability and medical payments, and additional living expenses if the rental property becomes uninhabitable. 

A tenant may also be able to customize a renters’ insurance policy by adding additional endorsements for extra coverage:

Scheduled personal property endorsement

Additional coverage can be purchased to cover items such as electronics, jewelry, or collectibles that are worth more than the coverage limit offered by a standard renters’ insurance policy. The insurance company may require the tenant to add these items to the schedule of personal property and have an item appraised before providing extra coverage.

Replacement cost coverage

Most standard renters’ insurance policies will pay for replacing an item stolen or damaged based on “actual cash value.” If a tenant has a sound system that is five years old and the electronics are stolen, the insurance company will pay for replacing a five-year-old system. By adding replacement cost coverage, the tenant will get the actual cost of replacing the stolen sound system with a similar system at today’s prices.

Coverage for identity theft

Some renters’ insurance policies also offer additional coverage for identity theft. For example, if the home is burglarized and a wallet or purse is stolen, adding identity theft coverage to a renters’ insurance policy may include coverage for legal fees, document replacement, and credit monitoring service costs as a result of identity theft.


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This article, and the Roofstock Blog in general, is intended for informational and educational purposes only, and is not investment, tax, financial planning, legal, or real estate advice. Roofstock is not your advisor or agent. Please consult your own experts for advice in these areas. Although Roofstock provides information it believes to be accurate, Roofstock makes no representations or warranties about the accuracy or completeness of the information contained on this blog.
Jeff Rohde


Jeff Rohde

Jeff has over 25 years of experience in all segments of the real estate industry including investing, brokerage, residential, commercial, and property management. While his real estate business runs on autopilot, he writes articles to help other investors grow and manage their real estate portfolios.

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