Renters insurance: what it covers, what it costs and how to buy it

Step by step

1. 1

   Count what you own

   Make a home inventory: list your furniture, electronics, clothes and other things with their value. The total tells you how much personal property coverage to buy. Keep photos and receipts, they help with a claim.

2. 2

   Choose replacement cost or current value

   A basic policy pays the current value of your things, so an old laptop brings much less than a new one costs. A policy with replacement cost pays to buy a new one, and it costs more. It is worth it if you own a lot of electronics.

3. 3

   Pick the liability limit

   Liability pays if you accidentally injure someone or damage their property, including legal costs if you are sued. Every Lemonade policy has at least $100,000 per occurrence, the amount many landlords ask for. Policies also help pay medical bills if a guest gets hurt in your home.

4. 4

   Set the deductible

   The deductible is the part of each claim you pay yourself. A higher deductible lowers the monthly price, so choose an amount you could pay right away after a theft or a fire.

5. 5

   Add what a renters policy excludes

   Standard renters policies do not cover floods or earthquakes. Flood insurance for your belongings comes from the National Flood Insurance Program (NFIP), usually with a 30-day wait before it starts. In California, renters policies must cover fire caused by an earthquake, and earthquake coverage for renters is sold by insurers that are members of the California Earthquake Authority.

6. 6

   Buy the policy and give it to your landlord

   At Lemonade you get a quote in the app or online in about 90 seconds and pay with a debit or credit card issued by a bank. It is sold in all 50 states and DC. If your lease requires renters insurance, send the policy to your landlord before you move in.