Life as a college student can seem pretty simple: Get to class, study in the evenings, party on the weekends.
But students who move out of their parents’ home also take their first few steps into adult life. And that means thinking about insurance.
If you live in an apartment, you need to consider this coverage. Not only does renters insurance protect your possessions in case they are damaged or stolen, but it also protects you from a liability claims should someone suffer an injury while on your property.
Fortunately, renters insurance is not expensive. In fact, the average cost for renters insurance is just $17 a month, or nearly $197 a year, according to Insurance.com rental insurance rate data.
Average renters insurance rates for top college cities and towns
Insurance.com comprised a roster of 60 towns and cities either known for having large student populations or for being home to many of the country’s most well-known colleges and universities, or both.
In the table below you can see how much renters insurance costs, on average, in your college town or city, for a renters policy with coverage levels of $40,000 for personal property, a $1,000 deductible and $100,000 of liability protection. New Orleans, Gainesville, Tallahassee, Boston and Houston are the priciest, while Provo, Burlington, Vermont, Madison, Wisconsin, Iowa City, and Fargo are the most affordable. Can't find your city or town on the list? If you want to know rates for anywhere in the country for 75 different coverage levels, use our average renters insurance rates tool to find out.
|City or town||State||Average renter insurance rate|
|New York||New York||$391|
|Chapel Hill||North Carolina||$269|
Why college students need renters insurance
A lot of young people skip renters insurance, believing they do not need it. But that can be a mistake, says Justin Herndon, spokesperson for Allstate.
Contrary to popular belief, a landlord’s insurance policy will not reimburse renters if their stuff is damaged or stolen. Renters need their own policy to get such protection.
Some students think the items they have are not valuable enough to insure. But Herndon says even little things -- clothes kitchenware, linens -- add up.
He adds that the average renter owns $30,000 worth of stuff. Although college students likely own less than that, they might own more than they think.
“Don’t underestimate how much stuff you actually own,” he says. “If you’ve got a laptop, you’ve probably got a smartphone. If you’ve got a guitar, you’ve probably got an amp.”
Typically, a policy will reimburse you if your goods are damaged due to:
- Water damages
At least a portion of your renters insurance also covers you away from home. So, if you travel to Canada or study in Europe, your renters insurance will cover you if someone steals that laptop.
“Wherever you go, your insurance coverage travels with you,” Herndon says.
In addition, renters insurance can protect you from a costly lawsuit or other costs if someone hurts themselves in your apartment.
“If someone’s injured at your place, it could cover their medical expenses,” Herndon says.
Renters insurance also can reimburse temporary living expenses – such as paying for a hotel room – if your apartment becomes uninhabitable due to fire, flood or another situation.
Renters insurance for college students: Answers to common questions
Of course, a college student has some insurance concerns that older renters do not.
How does renters insurance work if my parents co-signed my lease?
For example, many students have to turn to their parents to co-sign the apartment lease. In such a situation, the student can be the named insured on the policy, with the parents endorsed as an additional nonoccupant insured, Herndon says.
Can I get a renter insurance discount by bundling with my parents’ home insurance?
It is also possible for a student to get a discount on renters insurance by bundling the coverage with his or her parents’ homeowners policy. That can be true even if the student is going to school in a separate state. But you will need to check with your agent first before assuming you can do this, as Herndon says it is decided on a “case-by-case basis.”
Should I share a renters insurance policy with my roommates?
Also, if you have a roommate, you should not share the policy with your friend. Instead, you each should have your own separate policies. Here’s why: it’s true that you are allowed to share a policy, and this saves money if you split the cost. But the savings is minimal, considering the total cost for coverage is typically under $200 a year. And, if a claim is filed on the policy it will be on your claim history for three to five years, regardless of who filed the claim. That means if your roommate ends up making numerous claims on the policy you could end up paying higher premiums for renters (and other types of insurance) long after you have moved out.
How much renters insurance do you need?
If you are unsure how much coverage you need, here are some tips:
The personal property section of your policy pays to replace lost, stolen or damaged items you own. Typically you can choose pay out amounts of $20,000 to $100,000. Because renters insurance is affordable, it’s recommended you get at least $40,000 but if you have a lot of valuable possessions $100,000 is best.
Be sure to document your personal belongings by taking photos, saving receipts for new purchases and including serial numbers when appropriate.
Another important factor to look for when shopping for renters insurance is “actual cash value” compared to “replacement cost” coverage.
Actual cash-value coverage will reimburse you for the cost of the personal property at the time of the claim, minus the deductible. It’s important to account for depreciation when considering this coverage option. For example, if a bicycle was stolen from an apartment, five years after you bought it, you would be reimbursed for the current value.
Replacement cost coverage, on the other hand, will reimburse the full value of the new bicycle, after you purchase the new replacement, and submit your receipts. While the up-front cost is greater, you are more likely to receive accurate compensation for your possessions.
Liability for injuries
In addition to protecting your possessions, a renters insurance policy also offers liability coverage. Liability covers the cost for injuries if someone trips, falls or is hurt in your apartment. It also pays for lawsuits a guest may file against you after an accident you’re at fault for.
The amount of liability protection that’s right for you depends on the value of your personal assets, but Insurance.com Consumer Analyst Penny Gusner recommends a minimum of $100,000 liability limits for college students. But, she says ideally, you should carry $300,000 in liability, and
if you can afford more, get it. The cost of a lawsuit can quickly spiral out of control, putting all of your assets at risks.
Increasing your liability limits won’t add much more to the cost of your policy, and can be a financial lifesaver if someone is seriously injured in your home. On a policy covering $40,000 in personal property with a $1,000 deductible, you pay just $12 more a year for $300,000 in liability instead of $100,000. Hike liability to $500,000 and it’s just $20 annually, according to Insurance.com’s rate data.
Choosing a deductible amount
Deductibles are what you pay out when you file a claim before your insurance policy kicks in. So, if you file a claim for $5,000 worth of stolen or damaged personal items, and your deductible is $1,000, you pay that amount and receive $5,000 from your insurance company. Typically, you can select a deductible amount from $500 up to several thousand dollars. A higher deductible means lower rates, but it also means you have to have the money on hand to pay it when filing a claim. If a $1,000 deductible seems pricey on a college-student budget, you can opt for $500. For $40,000 in personal property coverage and $100,000 in liability, cutting your deductible in half from $1,000 to $500 only costs $16 more a year.
Comparing renters insurance rates by company
Like other types of insurance, the best way to save on renters coverage is to compare prices among companies. Refer to the table below, which shows rates by company for a policy of $40,000 in personal property coverage with a $1,000 deductible and $100,000 in liability.
Enter your state in the search field to see what you can expect to pay in your location.
|State||Company||Average annual rate|
|Georgia||Georgia Farm Bureau||$238|
|Indiana||United Farm Family||$246|
|Mississippi||Mississippi Farm Bureau||$446|
|North Carolina||North Carolina Farm Bureau||$159|
|North Carolina||State Farm||$232|
|North Carolina||Liberty Mutual||$247|
|North Dakota||American Family||$60|
|North Dakota||State Farm||$93|
|New Hampshire||Vermont Mutual||$100|
|New Hampshire||State Farm||$126|
|New Hampshire||Liberty Mutual||$137|
|New Jersey||State Farm||$126|
|New Mexico||Liberty Mutual||$107|
|New Mexico||State Farm||$150|
|New York||State Farm||$129|
|New York||New York Central||$150|
|New York||Liberty Mutual||$336|
|Ohio||Travelers Prop Cas Ins Co||$138|
|Oklahoma||Shelter Mut Ins Co||$244|
|Rhode Island||Liberty Mutual||$163|
|Rhode Island||State Farm||$196|
|South Carolina||State Farm||$186|
|South Carolina||South Carolina Farm Bureau||$196|
|South Dakota||American Family||$75|
|South Dakota||State Farm||$86|
|South Dakota||Liberty Mutual||$266|
|Vermont||Co Operative Insurance||$132|
|West Virginia||State Farm||$132|
|West Virginia||State Farm||$197|
|West Virginia||Liberty Mutual||$270|
Despite the importance of renters insurance, just 37 percent of renters have this coverage, according to III. But Herndon urges you not to join those who forsake coverage.
“Bottom line, there are many more benefits to consider with renters insurance than just guessing whether you have enough stuff to protect,” Herndon says.
Insurance.com commissioned Quadrant Information Systems to provide renters insurance rates for nearly every ZIP code in the country from up to six major insurers. Coverage includes medical payments coverage of $5,000, contents replacement at replacement value and loss of use at 10 percent of personal property limit.