8 (Little Known) Reasons You Need Renters Insurance

With inflation sending prices soaring, millions of renters are weighing which expenses are truly essential. Renters insurance is one worth keeping. Many landlords and property managers require it, but even when it’s not mandatory, the case for coverage is strong.

Here’s eight reasons why.

Reason #1: Renters insurance is affordable

The average cost of renters insurance is around $23 per month as of 2026, with Lemonade’s renters policies starting as low as $5 a month. For that, you get personal property coverage, liability protection, and more – all in one policy.

Real-world example: Marcus pays $12 a month for his Lemonade renters insurance policy. In October, his apartment is broken into and his gaming console and other gear are stolen. He files a claim through the Lemonade app and gets reimbursed after his deductible. Without renters insurance, the entire loss would have come out of his own pocket – more than eight years’ worth of premiums, gone in one incident.

Who	Marcus, renter in a mid-size city
What happened	Apartment break-in, gaming console and gear stolen
Monthly premium	$12/mo
Deductible	$250
Claim payout	$950
Annual premium cost	$144
Outcome	Covered. Nearly 8x his annual premium recovered in a single claim

Reason #2: Renters insurance covers your stuff when you’re at home, and out and about

Most renters don’t realize their personal property coverage travels with them. If your phone is stolen from a coffee shop or your laptop goes missing from a co-working space, your policy covers it. The same applies if your kitchen catches fire or your sprinklers flood your apartment.

Real-world example: Maya, a graphic designer, leaves her laptop at a co-working space while grabbing lunch. When she returns, it’s gone. Because her renters insurance includes off-premises personal property coverage, she files a claim and gets reimbursed for the replacement cost minus her deductible. Most renters don’t realize they’re covered outside the home until it happens to them.

Who	Maya, graphic designer
What happened	Laptop stolen from co-working space
Item value	$1,800
Where it happened	Off-premises (co-working space)
Covered?	Yes, off-premises theft is a named peril
Out of pocket	Deductible only

Reason #3: Your personal property is probably worth more than you think

The average two-bedroom apartment in the US contains about $30,000 worth of electronics, clothing, jewelry, bikes, and more, according to US News. If a fire, lightning strike, windstorm, theft, or vandalism wipes out your belongings, personal property coverage covers the cost of replacing them. Without it, you’re paying out of pocket.

Once you decide to get covered, take a quick inventory of your stuff to choose the right coverage amount. Lemonade makes it easy to view and adjust your limits through the app or website.

Real-world example: Jordan never thought much about the value of his stuff until he listed it out. When a pipe burst and damaged most of it, his personal property coverage covered the replacement costs. What renters insurance pays for in situations like this is exactly what most renters assume they’ll never need — until they do.

Item	Estimated value
MacBook	$1,500
Camera equipment	$800
Clothes and shoes	$600
TV	$400
Bike	$300
Total	$3,600+
Outcome	Covered under personal property after burst pipe

Reason #4: Your landlord’s insurance won’t cover losses to your personal property

Landlord insurance and renters insurance cover different things. Your landlord’s policy protects the building and any property they own, not your belongings. If a fire or flood damages your furniture, electronics, or clothes, that’s on you unless you have your own policy.

Real-world example: A fire broke out in Priya’s building due to faulty wiring in a neighboring unit. The landlord’s policy covered structural repairs — but not a single item Priya owned. Her neighbor, uninsured, replaced everything out of pocket.

	Priya (insured)	Neighbor (uninsured)
What happened	Building fire from neighboring unit	Same
Landlord’s insurance covered	Building structure	Building structure
Personal property covered?	Yes, via renters insurance	No
Out of pocket	Deductible only	~$8,000

Reason #5: Renters insurance covers dog bites

If your dog bites someone, your renters insurance liability coverage has you covered – whether the incident happens at home or at the park. There are two exceptions: your dog has a documented bite history, or is classified as a high-risk breed.

Real-world example: Sam’s dog Biscuit nipped a guest hard enough to draw blood. The guest went to urgent care. Sam’s liability coverage paid the full bill – Biscuit had no prior bite history and wasn’t a high-risk breed. Sam paid nothing out of pocket.

Who	Sam and Biscuit
What happened	Dog bite, guest required urgent care
Medical bill	$1,800
Bite history	None
High-risk breed?	No
Covered?	Yes, liability coverage applied
Out of pocket	$0

Reason #6: Renters insurance may help you out if you’re forced out of your apartment

If a covered event, like a kitchen fire or a flood from a neighbor’s unit makes your apartment uninhabitable, your policy may cover loss of use. That means temporary housing and basic living expenses until you can move back in.

Real-world example: The tenant upstairs left their bathtub running while on vacation. The resulting flood made the apartment below uninhabitable for three weeks. Loss of use coverage covered the hotel stay and additional meal costs in full.

What happened	Upstairs neighbor flooded the unit
Temporary housing	Extended-stay hotel, $120/night
Displacement period	3 weeks
Hotel total	$2,520
Additional meal expenses	Covered above normal budget
Covered?	Yes, loss of use coverage applied
Out of pocket	$0 (beyond deductible)

Reason #7: Renters insurance covers medical costs for injured guests

If a guest gets hurt at your place, your policy can help. For smaller claims (under $5,000), your medical payments to others coverage kicks in without any liability determination needed. If the situation escalates to a lawsuit, your liability coverage steps in. More on that below.

Real-world example: During a dinner party, a guest slipped on a wet kitchen floor and sprained her ankle badly enough to need an ER visit and specialist follow-up. Because the bill came in under the medical payments limit, it was covered without any lawsuit or liability determination required.

What happened	Guest slipped on wet kitchen floor
Total medical bill	$3,200
Coverage type	Medical payments to others
Coverage limit	$5,000
Lawsuit filed?	No
Covered?	Yes, in full
Host’s out of pocket	$0

Reason #8: Renters insurance may cover the costs to get you out of a jam if you’re sued

Liability coverage protects you if someone claims to be injured due to your actions or negligence. It covers legal fees if you need a lawyer and pays damages you’re found liable for. Coverage typically starts at $100,000 – which can make a significant difference when legal and medical bills start adding up.

Not sure how much renters insurance you need? Your lifestyle is a good place to start. Consider your risk exposure, profession, and whether you frequently have guests.

Real-world example: A friend trips over a rug, fractures their wrist, and incurs $8,000 in medical bills. After medical payments coverage handles the first $5,000, they file a civil lawsuit for the rest plus pain and suffering. Liability coverage steps in to cover legal defense and the settlement.

What happened	Guest tripped, fractured wrist
Total medical bills	$8,000
Medical payments coverage	$5,000 (applied first)
Lawsuit filed?	Yes, for remainder plus damages
Liability coverage limit	$100,000
Covered?	Yes, legal fees and settlement covered
Out of pocket	$0

Other reasons to get renters insurance

Your base policy covers a lot, but some of your most valuable items and common household risks need a little extra.

Extra Coverage (scheduled personal property): High-value items like cameras, jewelry, and fine art can be added to your policy as scheduled items. This coverage protects them from almost anything, including accidental loss – something a standard policy doesn’t cover. It typically costs just a few extra dollars a month.

Real-world example (Extra Coverage): A photographer schedules a $3,000 camera lens as a separate item under Extra Coverage. When it’s stolen from her car, she receives the full $3,000 back with no deductible. A standard policy alone may not have covered the full replacement cost.

Item	Camera lens
Value	$3,000
What happened	Stolen from car
Coverage type	Scheduled personal property (Extra Coverage)
Covered?	Yes, in full
Deductible	$0

Equipment Breakdown Coverage: A standard renters policy covers your electronics and appliances against named perils like fire and theft, but not mechanical or electrical failure. Equipment Breakdown Coverage fills that gap.

Adding people to your policy: A standard policy automatically covers household members related by blood, marriage, or adoption. Significant others need to be added as an additional insured — there’s a charge for this, so it’s sometimes more cost-effective for each person to get their own policy. Roommates are not covered under your policy and need to get their own.

Real-world example (Equipment Breakdown): Tom’s in-unit washing machine stops mid-cycle. A technician diagnoses an electrical motor failure — not a named peril, so not covered under a standard policy. But Tom had added Equipment Breakdown Coverage, and the repair was covered in full.

Item	In-unit washing machine
What happened	Electrical motor failure
Covered by standard policy?	No, not a named peril
Coverage type	Equipment Breakdown Coverage (add-on)
Repair cost	$600
Covered?	Yes

When is renters insurance required?

Landlords and property managers can require renters insurance as a condition of your lease. Even when it’s not required, carrying a policy protects you from significant out-of-pocket costs after a covered loss – whether it’s a burst pipe, a kitchen fire, or a stolen phone.

How much renters insurance do you need?

There’s no one-size-fits-all answer. You’ll want to think carefully about your needs across personal property, loss of use, medical payments, and liability coverage. For high-value items, it’s worth exploring your Extra Coverage options.

Getting covered takes just minutes with Lemonade’s online sign-up. 

Renters insurance FAQs

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A few quick words, because we <3 our lawyers: This post is general in nature, and any statement in it doesn’t alter the terms, conditions, exclusions, or limitations of the policies issued, which differ according to your state of residence. You’re encouraged to discuss your specific circumstances with your own professional advisors. The purpose of this post is merely to provide you with info and insights you can use to make such discussions more productive! Naturally, all comments by, or references to, third parties represent their own views, and Lemonade assumes no responsibility for them. Coverage may not be available in all states. Please note that statements about coverages, policy management, claims processes, Giveback, and customer support apply to policies underwritten by Lemonade Insurance Company or Metromile Insurance Company, a Lemonade company, sold by Lemonade Insurance Agency, LLC.  The statements do not apply to policies underwritten by other carriers.