WRITTEN BY: Mark Romero
UPDATED: AUGUST 11, 2023 | 3 MIN READ
Renters insurance is a critical — yet often overlooked — form of property insurance. It provides financial protection for renters’ belongings and liability coverage if someone is injured in their rental unit. The most up-to-date renters insurance statistics show that over 40 million people in the U.S. rent their homes.
However, despite its importance, surveys indicate that only around 37% of renters have active renters insurance policies. Check out this overview of key renters insurance statistics and trends in 2023 to better understand the current state of renter protections in the U.S. and learn why renters insurance is a necessity.
Key renters insurance statistics
- 55% of U.S. renters have insurance policies, as of July 2023. This equates to approximately 61 million people and is set to rise to 65 million people by next year.
- Renters insurance premiums have decreased steadily since 2015. As of 2020, the average premium was $173 per year.
- Renters in North Dakota pay the least for renters insurance, with average premiums of $116 per year.
- The most common deductible for a renters insurance policy is $500.
- 75% of landlords require tenants to carry renters insurance.
Average cost of renters insurance by state
| State | Average Annual Premium |
|---|---|
| Alabama | $225 |
| Alaska | $186 |
| Arizona | $164 |
| Arkansas | $210 |
| California | $171 |
| Colorado | $161 |
| Connecticut | $180 |
| Delaware | $151 |
| Washington D.C. | $159 |
| Florida | $182 |
| Georgia | $212 |
| Hawaii | $176 |
| Idaho | $148 |
| Illinois | $157 |
| Indiana | $164 |
| Iowa | $136 |
| Kansas | $162 |
| Kentucky | $157 |
| Louisiana | $247 |
| Maine | $148 |
| Maryland | $160 |
| Massachusetts | $172 |
| Michigan | $181 |
| Minnesota | $134 |
| Mississippi | $256 |
| Missouri | $172 |
| Montana | $153 |
| Nebraska | $143 |
| Nevada | $179 |
| New Hampshire | $147 |
| New Jersey | $154 |
| New Mexico | $180 |
| New York | $173 |
| North Carolina | $160 |
| Norht Dakota | $116 |
| Ohio | $162 |
| Oklahoma | $226 |
| Oregon | $154 |
| Pennslyvania | $152 |
| Rhode Island | $183 |
| South Carolina | $186 |
| South Dakota | $118 |
| Tennessee | $187 |
| Texas | $216 |
| Utah | $147 |
| Vermont | $151 |
| Virginia | $152 |
| Washington | $158 |
| West Virginia | $179 |
| Wisconsin | $128 |
| Wyoming | $146 |
The current state of renters insurance in 2023
Renters insurance has always been important, but statistics show that more and more people are realizing how its importance plays a vital role in their lives.
Growth and adoption of renters insurance
In 2022, renters insurance experienced significant growth across various demographics. With a rising number of individuals choosing to rent rather than own homes, the demand for renters insurance has surged.
This growth is fueled by a combination of factors, including increased awareness of the benefits of insurance coverage, the U.S. housing crisis, the expanding rental market, and insurance companies efforts to tailor policies to meet the unique needs of renters.
As more people become aware of the financial risks associated with renting without insurance, the number of policies purchased has seen a steady upward trend. Additionally, millennials and younger generations, who make up a considerable portion of the rental population, are showing a greater inclination toward seeking financial security through renters insurance.
Regional variations in renters insurance coverage
While the adoption of renters insurance is on the rise, there are still regional variations in coverage rates across different areas. Urban centers and densely populated regions tend to have higher rates of renters insurance adoption, possibly due to more exposure to theft and accidents. On the other hand, rural or less populated areas may exhibit lower coverage rates, where some renters might perceive the risk of losses as relatively low.
Factors contributing to the increase in renters insurance policies
Several factors contribute to the growth of renters insurance policies in 2023:
- Property Management Requirements: Many property management companies and landlords now require tenants to purchase renters insurance as a condition of their lease agreements. This shift helps protect landlords from potential liability claims and encourages renters to secure coverage.
- Rise in Natural Disasters: The increasing frequency and intensity of natural disasters have made renters more aware of the need for insurance coverage. The fear of losing personal belongings to unforeseen disasters has incentivized many renters to invest in insurance policies.
- Shift in Perception: Renters insurance has shed its image as an unnecessary expense and is increasingly viewed as a sensible investment to safeguard against unforeseen events.
- Customized Coverage Options: Insurance companies have adapted their offerings to suit renters’ diverse needs, allowing policyholders to tailor their coverage based on the value of their belongings and the potential risks they face.
- Online Convenience: The ease of accessing insurance information and purchasing policies online has facilitated the process, making it quicker and more convenient for renters to obtain coverage.
What type of renters insurance do you need?
Renters insurance includes personal property coverage, loss of use coverage, and liabilty coverage. However, the limits vary depending on each person’s needs. The table below shows common coverage amounts.
| Type Of Coverage | Coverage Amounts and Ranges |
|---|---|
| Personal property | $15,000 – $500,000 |
| Liability and medical expenses | $100,000 or $300,000 or $500,000 |
| Loss-of-use and additional living expenses | $3,000 – $5,000 or 40% of your personal property limit |
FAQs
What percentage of people don’t have renters insurance?
According to the Insurance Information Institute (III), around 55% of renters in the U.S. had renters insurance. This leaves roughly 45% of people without coverage.
Why do people choose not to have renters insurance?
There are several reasons for people not having renters insurance, including:
- Perceived cost as an additional expense
- Lack of awareness of coverage and benefits
- Overestimation of landlord insurance coverage
- Temporary living arrangements
- Low-value possessions or self-insurance belief
- Trust in property security measures
- Assumption of previous homeowner’s insurance
- Language barriers and accessibility issues
- Negligible legal requirements in some regions
- High-risk tolerance and confidence in handling losses
Why is it bad to not have renters insurance?
Not having renters insurance can lead to financial risks, leaving personal belongings unprotected, liability exposure, and potential hardships after unforeseen events. Renters insurance provides peace of mind, affordability, and essential coverage for tenants, ensuring they’re protected and prepared for unexpected circ*mstances.
Find renters insurance
Renters insurance helps protect your belongings in the event of a disaster. To compare rates, use our online quoting tool today.
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Related content:
- What Does a Renter’s Insurance Policy Cover?
- How to File a Renter’s Insurance Claim
- Renters Insurance Deductibles: How Do They Work?
- Can Roommates Split Renters Insurance?
- What You Need To Know About Flood Insurance For Renters
- What Is Loss Assessment Coverage?
