What impacts tenants’ insurance premiums?


The insurance premiums for tenants are cheaper than many other types of insurance. However, the cost of tenant insurance can vary significantly between individuals. Tenant insurance companies use factors such as your state, age, and creditworthiness to determine policy rates. This means that you and your best friend may pay different prices across town.

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When you are in the rental insurance market, it is important to understand what factors will affect your premium. Keep in mind that you can change some of these factors to get a lower premium when you buy cheap tenant insurance.

[ Read: How To Buy Cheap Renters Insurance Online]

What is a tenant insurance premium?

A tenant insurance premium is essentially the same as the cost of your insurance policy. It includes the price of standard coverage, such as personal property coverage, plus any notices you have added, such as flood insurance. Tenant insurance premiums are usually calculated as an annual or semi-annual rate, but many people pay their premium in monthly installments.

Tenants’ insurance premiums are paid to the insurance company that takes out your policy. Your tenant’s insurance premium remains the same for the duration of the contract, usually one year or six months. However, if the policy needs to be extended, your premium may increase or decrease.

What are the main factors influencing tenant insurance costs?

There are a wide variety of factors that will affect your renter’s insurance price. Here are some of the most common.


Your location has a huge impact on your tenant’s insurance premium. Tenant insurance is more expensive in some states and cheaper in others. You will see this in the next section when we look at the average cost of rental insurance for each state. In addition, your zip code will affect the price. Tenant insurance is usually the most expensive in areas with high crime and theft rates. Insurance can also be more expensive in areas with bad weather.


Your age will, to some extent, affect your renter’s insurance premium. Younger people tend to pay higher rates for tenant insurance than older people. So, if you’re just a college graduate who just moved to town, expect to pay more than a retiree to rent a Florida apartment. Insurance companies believe that age comes with risk. Hence, young tenants are charged higher premiums to offset potential claims and losses.

Credit score

Almost every insurance company does credit checks to help calculate your renter’s insurance premium. The higher your credit rating, the lower your tenants’ insurance costs. The opposite is also the case: tenants with poor creditworthiness pay above-average premiums. Improving your credit rating is one of the best ways to get a cheaper premium and save money on your policy.

Claims history

Tenants who have made insurance claims in the past – including small claims on personal property – pay a higher rate for their tenant insurance. Renters who have never made an insurance claim or who have not made a claim in recent years pay the lowest rates. From the perspective of an insurance company, it is more likely that tenants with a history of damage will make additional claims in the future so that they offset their risk by charging a higher price.

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Type and scope of coverage

Tenant insurance is worthwhile for most people, but it doesn’t cover everything. You may need to endorse your policy to fill any gaps in coverage. When you buy endorsements like flood insurance, valuables insurance, or earthquake insurance, you pay a higher rate. Likewise, the amount of coverage you purchase will affect your rate. The higher your coverage limits, the more expensive your premium will be.


Every tenant insurance has a deductible. This is the outlay that you pay for a covered loss before the insurance company reimburses you. The higher your deductible, the lower your insurance premium. Many renters choose a higher deductible to save money. Remember, however, that you are responsible for the deductible. If you need to file a claim, you should be able to easily afford the cost out of pocket.

[ Read: Raising Deductibles to Save Money on Insurance: Does It Work? ]


Discounts are another factor that affects tenants’ insurance costs. Most insurance companies offer discounts that can save you money on your policy. The more discounts you get, the cheaper your premium will be. When looking for cheap rental insurance, look for insurance companies that offer several discounts that you can qualify for. Joint discounts for tenant insurance are damage-free, pay your premium in full, have good grades and bundle your policies.

[ Read: Here’s How to Bundle and Save on Your Insurance ]

What is the average cost of tenant insurance for each state?

As already mentioned, the cost of tenant insurance varies depending on the state. The average cost of renting insurance in the US is $ 179 per year, which equates to just under $ 15 per month. The table below shows the average annual insurance premiums for renters in all 50 states plus Washington DC

StatusAverage annual premium
Alabama$ 222
Alaska$ 175
Arizona$ 175
Arkansas$ 211
California$ 178
Colorado$ 164
Connecticut$ 188
Delaware$ 157
Florida$ 185
Georgia$ 214
Hawaii$ 181
Idaho$ 152
Illinois$ 166
Indiana$ 172
Iowa$ 144
Kansas$ 172
Kentucky$ 166
Louisiana$ 234
Maine$ 149
Maryland$ 161
Massachusetts$ 191
Michigan$ 185
Minnesota$ 140
Mississippi$ 252
Missouri$ 179
Montana$ 147
Nebraska$ 149
Nevada$ 182
New Hampshire$ 148
New Jersey$ 160
New Mexico$ 186
new York$ 189
North Carolina$ 158
North Dakota$ 126
Ohio$ 169
Oklahoma$ 236
Oregon$ 161
Pennsylvania$ 157
Rhode Island$ 185
South carolina$ 184
South Dakota$ 127
Tennessee$ 195
Texas$ 225
Utah$ 155
Vermont$ 153
Virginia$ 152
Washington$ 160
Washington, DC$ 157
West Virginia$ 189
Wisconsin$ 143
Wyoming$ 146

We appreciate your feedback on this article. Contact us at Inquiries@thesimpledollar.com with comments or questions.

In response to the Covid-19 pandemic, many insurance companies granted relief in the form of percentages on monthly bills and a freeze on cancellations due to insolvency. While not recommended, you can technically adjust your coverage to save money when needed. Again, we strongly advise against it.

Below is how you can benefit from the recently approved Economic Relief Act:

Who can benefit from it?

To qualify for rental allowance under the CARES Act, at least one family member in the household must be unemployed or have a significant loss of income due to the pandemic. The income must be at or below 80% of the median income in your county. You must also be at risk of homelessness.

Who gets how much?

When families fall below 50% of median income, priority is given to rent relief funds. Families can receive rent for up to one year and rent relief assistance in three months in the future under the CARES Act.

How do I apply?

If you need to apply for assistance, the way you do it depends on where you live. If your city or town already has a rental assistance program in place, you will likely use it to apply for new assistance.

You can contact your local housing authority, nonprofit groups, or contact your local representatives to find out where and how to apply. Your landlord may also be able to apply for you – but they will need to get your consent and signature beforehand.


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