Renters insurance is one of the most affordable types of coverage available, yet many renters misunderstand what it includes—or skip it altogether. These mistakes can lead to expensive out-of-pocket losses or major frustrations during a claim. This guide breaks down the most common renters insurance mistakes and how to avoid them, so you can stay fully protected without overspending.
Assuming the Landlord’s Insurance Covers Your Belongings
One of the most widespread misconceptions is believing the landlord’s policy covers the tenant’s personal property.
It does not.
Landlord insurance covers the building—not:
- Your furniture
- Your clothing
- Your electronics
- Your appliances
- Your valuables
Without renters insurance, you must replace everything out of pocket after a fire, theft, or water damage.
Choosing the Cheapest Policy Without Reviewing What’s Covered
Many renters choose the lowest-priced plan, assuming all renters insurance is the same. But cheaper plans often include:
- Lower personal property limits
- Actual cash value instead of replacement cost
- Higher deductibles
- Fewer covered perils
- Limited liability coverage
Cheap plans can cost you far more after a loss.
Not Choosing Replacement Cost Coverage
A major mistake renters make is accepting actual cash value (ACV) coverage by default.
ACV pays what your items are worth today, not what it costs to replace them.
Replacement cost coverage pays for brand-new items, and the price difference is usually very small.
Underestimating the Value of Personal Belongings
Most people underestimate the total value of their possessions. Typical apartment belongings often total $20,000–$30,000 or more.
If your coverage limit is too low, your insurer won’t pay enough to replace everything after a major loss.
Always take an inventory to estimate accurate coverage.
Ignoring Liability Coverage
Liability insurance is one of the most valuable components of renters insurance, yet many renters keep the minimum limits.
Liability protects you if:
- Someone gets hurt in your apartment
- Your pet injures someone
- You accidentally damage someone else’s property
Experts recommend at least $100k–$300k in liability coverage.
Forgetting About Loss of Use Coverage
Loss of use (also called “additional living expenses”) pays for temporary housing, food, and essentials if your rental becomes uninhabitable.
Many renters overlook this protection and struggle to pay for emergency housing during a disaster.
Not Adding Riders for High-Value Items
Standard renters insurance has low limits for:
- Jewelry
- Watches
- Firearms
- Art
- Collectibles
- Musical instruments
- High-end electronics
You may need scheduled personal property to insure these items correctly.
Not Documenting Belongings Before a Claim
Having no record of your possessions makes claims slower and more difficult.
A simple home inventory (photos, receipts, and item lists) helps you:
- Prove ownership
- Get faster payouts
- Avoid disputes
It only takes a few minutes and saves significant frustration.
Forgetting to Update the Policy When Life Changes
Many renters forget to revise their policy when:
- Moving to a new apartment
- Getting a roommate
- Acquiring expensive items
- Getting engaged or married
- Traveling for long periods
These changes can affect both coverage needs and price.
Letting Coverage Lapse
Renters often forget renewal dates because renters insurance is inexpensive and out of sight.
A lapse can lead to:
- No protection during an emergency
- Higher premiums later
- Rejection from some insurers
- Landlord lease violations (if insurance is required)
Automatic payments help prevent accidental coverage gaps.