Renters shopping in antique store

Your Guide to Renter's Insurance

Arizona Federal Staff

If you’re renting an apartment or house, getting renter’s insurance is a good idea. For about the cost of a few lattes a month – a renter's insurance policy helps cover your personal belongings against theft or damage, which would not be covered by a landlord’s insurance.

To learn more about renter’s insurance and the various options, check out our guide below.

What is renter’s insurance?

Renter’s insurance covers your personal belongings in the event of accident, theft or natural disaster (exceptions include flooding and earthquakes) – and will save you the expense of trying to replace your items if they’re stolen or damaged. In addition, renter’s insurance provides liability coverage that protects you in case someone is injured on your property.

Should I choose replacement-cost coverage or actual cash-value coverage?

Replacement-cost coverage (RCC) plans will cover the replacement purchase of a damaged or stolen object. This type of coverage will have pricier premiums, but is usually worth the extra expense.

Actual cash-value (ACV) coverage, on the other hand, has lower premiums, but offers only the cash value of the personal item at the time of the claim (the original value minus depreciation).

How much coverage do I need?

Each policy will offer coverage to replace your possessions up to a certain limit. It’s best to take out a policy that will protect the full value of your belongings.

To determine how much coverage you need, take an inventory of your assets. If you’re choosing a replacement-cost plan, note how much it would cost to replace each item. If you’re going with a cash-value plan, note each item’s current worth. Add up the total and choose a policy that provides enough coverage.

Are all disasters covered in renter’s insurance?

Most policies will cover damage caused by a wide range of circumstances including fire, theft, windstorms and more. However, most policies will not cover damage caused by floods or earthquakes.

Should I choose a lower deductible?

Many people choose a policy with a lower deductible and pay a higher monthly premium payment, but that’s not always the smartest choice financially. With a high-deductible policy, the payment for your monthly premium will be lower and the amount you save each month will likely offset the cost of the higher deductible if you need to file a claim. 

What kind of liability coverage does my policy offer?

Your renter’s insurance will offer you liability protection against lawsuits for bodily injury or property damage caused by you, your family members or your pets. This coverage will pay for legal counsel in a court of law and medical coverage for anyone who gets injured on your property.

Do I need a rider?

A rider (also known as a floater) will provide additional coverage for pricier items if they are lost or stolen. Most policies include a cap for replacing a specific kind of item, including expensive jewelry, furs, collectibles and costly sports equipment. If you own such items, you may want to add it to your policy.

What is ALE?

Additional living expenses (ALE) covers extra expenses you may have, such as hotel bills and food costs, if your home is destroyed or unlivable because of a disaster covered in your policy.

Arizona Federal offers a wide range of insurance options, including renter’s insurance. For a no-cost, no obligation insurance review – or to get an online quote, visit ArizonaFederal.org/Insurance.