If you’re looking for renters insurance, you’re probably wondering how much it costs. We could tell you that renters insurance is the single best investment you can make to protect your family, of course. But that doesn’t answer the question of how much does it cost.
There are a number of ways to approach that question, so let’s dig in.
How Much Does It Cost? Relative To What?
How much is renters insurance? Well, that depends on your location for one. As an example, Fayetteville, NC Renters Insurance might cost as little as $125.00 annually, sometimes much less. NC has some unique things going on at the state level that keep the price artificially low, however.
The real question is what you’re comparing it to. How much does renters insurance cost relative to, say, homeowners insurance? Renters insurance costs five to ten percent of the cost of homeowners insurance, broadly speaking. That’s because you’re not insuring the structure, only your property and your liability.
How much is renters insurance relative to not having renters insurance? For that, you can ask the person who had a kitchen fire without renters insurance. He’s out thirty thousand dollars for the damages, and the landlord’s insurance company will pursue him until they get it back from him.
How much is renters insurance relative to the value of your time? Some people will spend hours shopping around to save two dollars. That just doesn’t seem productive, since the value of that person’s time is more than the two dollars saved.
In North Carolina, renters insurance is less expensive than in almost every other state. You can get renters insurance for ten dollars a month, sometimes even less. You wouldn’t pay that monthly, of course. There would be fees to bill it, and those would cost as much as the premium you were paying. You’d just pay for the year and be done with it until the twelve month mark rolled around.
The national average price of renters insurance is just $187.00, according to the III. That works out to as little as fifteen dollars per month. The vast majority of families can budget renters insurance easily at those prices.
Additionally, it's important to note that renters are at a significantly higher risk of experiencing loss than homeowners. Renters occupy roughly one third of total housing stock in the country, and yet they are fully fifty percent more likely to experience theft than homeowners, according to the Bureau of Justice Statistics.
It only costs a few dollars a month to protect your family, and this cheap renters insurance is a great way to mitigate the additional risks that come with being a renter.
Why Does The Cost Of Renters Insurance Vary By Location?
In a nutshell, risk varies by location. How much renters insurance costs varies based on risk, as well as what the state allows in various capacities. For example, losses on Fayetteville, NC Renters Insurance are generally fairly low, so the policies are quite affordable.
On the other hand, parts of Florida have hurricane risk that’s not really present in Fayetteville. How much are renters insurance policies that cover wind in Florida? Somewhat more, for obvious reasons.
As to what the state allows, let’s take California as an example. In California, everyone in a given area is likely to pay a similar price. The reason for that is because California does not allow the use of credit in rating or underwriting of renters insurance policies. How much are California renters insurance policies? About $200 a year. It’s not a significant difference from the national average, but you can see how when everyone pays the same the cost is spread around differently.
In addition to the obvious claim and risk concerns, the amount of people who have renters insurance in a given area, and therefore the risk and the size of the risk pool, can vary widely. Nationally, forty-four percent of Americans have renters insurance, but there is a great deal of variation.
In Fayetteville, many people have renters insurance. Combined with a low number of claims in a generally safe city, this leads to low prices for everyone. In more rural states, or in states where few people rent, this may vary of course.
Additionally, different states have different regulatory burdens. The regulatory burden is the quantity of time and money that is required to comply with the various state regulations and requirements to do business in the state. Some of these are costs that only apply when a company starts doing business in the state, such as software changes for something they must or must not do.
Some of these are ongoing, such as reporting requirements. While the regulatory burden makes up a small part of the price of your renters insurance, it’s certainly a factor. As you can see, there are a wide variety of things that impact the cost of renters insurance by location. However, the coverage is nearly always inexpensive.
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