Best renters insurance companies for April 2024

If you rent your home, you may benefit from renters insurance. A renters policy can provide financial help if your rental catches on fire or someone breaks in, destroying your belongings. It will also cover your personal liability if you’re sued and pay for medical expenses for a guest if they’re injured on your property. For a catastrophic event that displaces you from the rental, the policy can also pay for additional living expenses you’ll pay until you’re back home.

Most insurance companies offer renters insurance, so how can you choose the policy that’s right for you? We compared dozens of carriers to find the best renters insurance companies in New Jersey. Understanding the differences between the companies and how to compare policies and carriers can help you find the best policy for the right price.

Best Renters Insurance Companies

Lemonade

If you prefer a 100% digital experience and cheap coverage, Lemonade may be a good choice. This carrier offers one of the cheapest rates for renters insurance in New Jersey. Besides the basic coverages, you can customize your Lemonade renters insurance with extra coverage for high-value items, like jewelry, bikes, musical instruments and fine art. If you own appliances, like a washing machine, equipment breakdown coverage may be a beneficial add-on.

Nationwide

Besides the standard coverages, Nationwide includes credit card and check forgery coverage plus building additions and alterations into the base policy. For New Jerseyans with the ability to make improvements or changes to their rental, a Nationwide renters policy may be a good option. Optional coverages include replacement cost on contents, additional coverage on high-value items, water backup, theft extension and earthquake and volcano coverage. Although Nationwide has few discounts to offer, it ties with Lemonade as the cheapest sample rate for New Jersey renters insurance.

Farmers

If you’re looking for an affordable basic policy, Farmers might be a good choice. It offers standard coverage with the option to add replacement cost and a personal articles floater for valuables over $500. Business professionals may save more with Farmers and there are also discounts for bundling policies, having a fire alarm or security system and if you’ve been smoke free for two or more consecutive years.

Erie

Although Erie is only available in 12 states, New Jersey is one of them. If you want a customizable policy, Erie may be the right choice for you. It offers three bundle options with advantages like identity theft coverage, sewer and drain backup and equipment breakdown coverage. Or you can pick optional coverages to add to your policy such as home sharing, earthquake and sewer backup coverage.

Erie is not the cheapest option on our list, and it only has a few available discounts. If you get a quote in advance, insure more than one policy or have safety features like an alarm or sprinkler system, you could save on renters insurance with Erie.

Allstate

Allstate offers the option to include scheduled personal property for high-value items and identity theft restoration in a renters insurance policy. Although it has few discounts, retired New Jersey seniors may want to consider Allstate for renters insurance, as they can save up to 25% on their premium. Those who prefer a digital experience can download the mobile app or go online to file and track claims, pay bills and view policy documents.

American Family

New Jerseyans who travel, have a pet or run a home-based business may want to check out American Family. These optional coverages, plus identity theft restoration, can be added to a renters insurance policy to tailor it to your unique needs. American Family also offers a diminishing deductible feature, which lowers your deductible by $100 for each year you remain claims free. With higher-than-average rates, you could increase your deductible to lower your premium while stacking up a diminishing deductible if you have to file a claim in the future.

State Farm

One of the oldest insurers in the country, State Farm offers a base renters policy with inflation protection included. Each year, coverage will increase to match the rise in cost of living. Renters can also include identity theft restoration or earthquake coverage. However, State Farm is one of the more expensive carriers and only offers a few discounts compared to other carriers on our list of best renters insurance companies in New Jersey.

USAA

One thing that sets USAA renters insurance apart from the other companies is flood damage is included in the basic policy. There are also features military members might need, like coverage for gear and uniforms. You can also add electronics coverage if you need higher limits than the base policy offers. However, there’s no coverage for roommates on the same policy and you have to be a current or past service member, their spouse or child, to be eligible for coverage.

Why should you get renters insurance

While New Jersey law doesn’t require you to carry renters insurance, there are reasons it might make sense to get renters insurance:

• Your landlord requires it.
• You want coverage if your belongings are damaged or stolen.
• You can’t afford to replace your stuff after a loss.
• You have high value items, like collectibles, jewelry, fine arts or musical instruments.
• You have a pet that could hurt someone or damage their property.
• You can’t afford temporary accommodations if your rental is damaged.
• You want coverage in case of legal claims against you.

Renters insurance offers four main coverages: personal property, liability, additional living expenses (loss of use) and medical payments to others. They come in a package, so if you want one coverage, you’ll get them all.

Renters insurance is an inexpensive way to protect yourself financially. If you don’t have the money to self insure after a loss, renters insurance is a cheap solution.

When should you get renters insurance? 

Getting renters insurance is quick and can usually be done within an hour. While other types of insurance have exclusion periods and specific enrollment periods, you can apply for and start renters insurance at any time.

You can choose your own effective date — or policy start date — when you purchase renters insurance. That’s the time, day, month, and year when your coverage begins. The effective date is also when you pay your first monthly premium. You can set the effective date of your renters insurance to the day you move in.

How to compare between renters insurance companies

Although it’s tempting to go with the cheapest price, comparing renters insurance companies can help you find the best deal on the coverage you need. Strictly going by price could mean the policy is lacking an important coverage that could leave you financially vulnerable.

Use these tips to compare between New Jersey renters insurance companies.

Compare and understand available coverage

Most policies come standard with the following coverages:

• Personal property: Covers all your stuff in your rental, including clothes, electronics, furniture, decor and appliances.
• Personal liability: Provides coverage if you injure someone or cause damage to their property. Liability insurance can cover medical bills for others and your legal fees if you’re sued and found legally responsible.
• Loss of use: Pays for additional living expenses you incur while staying elsewhere temporarily after a covered peril. Additional expenses can include a hotel stay, short-term rental, parking or transportation fees and boarding a pet.
• Medical payments to others: Pays for guest medical expenses if they are accidentally injured on your property.

Your renters policy could have optional coverage add-ons you can include to customize your policy. The coverage limits and options vary by company. Common add-ons are water backup, coverage for hobbies and sports equipment, high-value items and identity theft restoration.

Consider actual cash value vs. replacement cost

There are two ways a renters insurance company will pay claims for personal property: actual cash value (ACV) or replacement cost. While some carriers in New Jersey offer replacement cost on the standard policy, others offer it at an extra cost.

If you choose ACV, you’ll get the depreciated value of your belongings when you file a claim. For instance, if you paid $1,000 for a couch five years ago, you might only get $300 for it today. Replacement cost means the insurer will pay to replace the couch for what it would cost today for the same couch or one of similar quality.

Get several quotes

To get the best deal, get several quotes from different carriers to compare. Request quotes with the same coverages, limits and deductibles to do a side-by-side comparison. This can help you identify which company will best meet your needs.

Note any differences that could affect your final cost of renters insurance. For example, does one company offer replacement cost as part of the base policy, but the rest consider it an add-on option? Are there optional coverages that are beneficial and only available through select carriers?

Now that you know the differences, compare price and other factors you may find important, like customer satisfaction and financial ratings. A company’s NAIC index shows how often consumers file complaints compared to the national industry average. Their financial rating through AM Best or Moody’s will show how well it can handle its financial obligations, including paying claims.

Working with a trusted insurance agent can help you compare and differentiate between companies and their policy options. They can answer your coverage and policy questions, too, so you’ll be confident with your purchase knowing you’re protected if something happens.

How much does renters insurance cost?

Besides coverage selections, policy limits and deductible, how much renters insurance costs depends on several personal factors such as your:

• ZIP code.
• Age.
• Credit score.
• Claims history.
• Marital status.

Rental characteristics also matter, like how old the building is, what materials it’s made of and the age of the roof, HVAC and plumbing. Even if you live in an older home and need high coverage limits, renters insurance is still one of the most affordable types of home insurance policies available.

The 2020 average annual renters insurance premium in New Jersey was $154, according to the 2022 National Association of Insurance Commissioners (NAIC) report. That’s cheaper than the national average, which is $173 per year.

Compare the annual average to the national average for an HO-3 homeowners insurance policy, which is $1,311, and you can see renters insurance is one of the cheapest options available.

How to choose the best renters insurance for you

Whether it’s price, getting just enough coverage to satisfy your landlord or a company’s performance, knowing what’s important to you can help you choose the best renters insurance company and policy.

Consider working with an independent New Jersey insurance agent. They contract with multiple carriers, so they can do the research and gather quotes for you. Once they know your coverage needs and what’s important, they can help you narrow down your options until you find the best renters insurance for you.

How to lower your renters insurance rate

Although renters insurance is generally inexpensive, there are ways you could lower your renters insurance rate even more.

Take advantage of discounts

Applying discounts can help lower your renters insurance cost. Many discounts can be stacked together to maximize savings.

Although discounts can vary by company, here are some of the more common renters insurance discounts:

• Bundling more than one policy together with the same carrier.
• Staying claim free.
• Installing protective devices, like an interior sprinkler system, fire alarm and burglar alarm.
• Living in a gated community.
• Paying in full rather than installments.
• Going paperless.
• Setting up automatic payments.
• Having an affiliation with an organization or institution, like college alumni association or credit union membership.

Shop around

If you buy a policy from the first renters insurance quote you get, you could lose out on premium savings or valuable coverages. Once you determine your coverage needs, compare the same coverages, limits and deductibles with several companies.

Comparing “apples to apples” can help you find the cheapest renters insurance company for your needs. Be sure to compare details such as actual cash value versus replacement cost on contents. Although replacement cost coverage is more expensive, you’ll receive more compensation when you file a claim. With actual cash value, you’ll only get the depreciated value of your stuff.

Raise your deductible

Raising your policy deductible will lower how much you pay for renters insurance. However, it will also increase how much you pay if you file a claim unless you’re insured with a company like American Family, which offers a diminishing deductible feature.

Consider comparing the premium savings with the deductible increase amount to see if the savings are worth it before making the switch. If you decide to increase your deductible, make sure you can afford to pay the higher amount after a loss–which can occur at any time.

Review your policy annually

Reviewing your policy annually can help ensure you’re only paying for the coverage you actually need. You might find that you no longer need as much personal property coverage if you’ve downsized your belongings. Or, your landlord may have installed safety or security features that make you eligible for a discount.

Improve your credit

In many states, including New Jersey, your credit score can impact your insurance rates. A credit-based insurance score differs from a financial credit score. Insurers use your ability to manage your money, like paying bills on time, to determine your insurance score. The higher your score, the more you can save on your renters insurance.

Not all states use credit scores, though. In the following states, an insurer can’t use credit to determine renters insurance rates:

• California
• Maryland
• Massachusetts
• Michigan
• Oregon
• Washington

New Jerseyans with a low credit score may find increasing their insurance score by paying bills on time and lowering debt will help them save on their insurance premium.

Frequently Asked Questions

What are the cheapest renters insurance companies?

The cheapest renters insurance companies depend on where you live and your coverage needs. Personal factors, like your age, claims history, and credit score (if applicable in your state) can also affect your cost of renters insurance. When gathering renters insurance quotes, we found Lemonade, Farmers and Nationwide to be the cheapest renters insurance companies in New Jersey.

What does renters insurance cover?

Renters insurance provides coverage for your belongings and liability if you are sued or held legally liable for someone else’s injuries or damaged property. There is also coverage for guest injuries and additional living expenses if you need temporary accommodations while your rental is being repaired after a covered claim. There could be other coverages available, depending on the policy and insurance company. Examples include high-value items coverage, water backup, identity theft protection and credit card coverage.

How does renters insurance work?

If you experience a covered loss under a renters insurance policy like having your belongings stolen, renters insurance will reimburse you for a covered loss. After you’ve realized the loss, you can file a claim with your renters insurance company. If they approve the claim, the insurer will reimburse you up to your policy coverage limits. If a deductible applies, they will subtract it from the amount the insurance company pays. For instance, if you file a claim for $5,000 in property damage and have a $500 deductible, the carrier will pay $4,500.

Does renters insurance cover theft?

Yes, renters insurance covers theft. If someone steals your property in your rental, from your car or even if you’re away from home for vacation or commuting for work or school, your policy should cover the theft. Before you file a theft claim, check your policy deductible and calculate the estimated value of your stolen items. If they are less than or close to your deductible, it may not be worth filing a claim.

How do you file a renters insurance claim?

How you file a renters insurance claim depends on the company. You can usually file in person, over the phone, or online. For example, if you have renters insurance through Lemonade, you’ll file through the mobile app. Open the app, tap “file a claim,” then provide details about the claim. Claims are instantly approved or handed off to the claims team for further processing. With Erie, you can file through your agent or by calling Erie directly. You can then access your online account to check the status of your claim.

*Sample cost based on a 33-year-old individual renting a 1,200 square-foot apartment with one other roommate in a building with a local fire alarm and sprinkler system. We built a standard plan that includes property/contents coverage of $30,000, liability coverage of $100,000, and a $500 deductible.

Prices appearing on this webpage are sample rates for illustrative purposes only based on a particular consumer profile. For specific pricing, you should go either to a certified broker or directly to the insurer’s website.