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Most people are aware that if they are renting a home, apartment or condo then a renter’s insurance policy will protect your belongings against accidents, theft, fire, vandalism, etc.

Some policies will even provide coverage against accidents where you, or a family member, is found liable.

Fortunately, renter’s insurance is rather inexpensive when compared to other types of insurance. However that doesn’t mean that there aren’t ways you can save money when it comes to your policy.

Even if you could save fifteen dollars a month on your policy wouldn’t you rather spend that with your family instead of paying it to your insurance company? And who knows, you could even find that you are able to save more each month.

Pay Your Renter Premium Up Front

If you are able to pay your yearly premiums in one lump sum you should be able to get a discounted rate.

Why? That's because it lets your insurance company know that you are a long term customer and are committed to staying with them. Usually, this loyalty is rewarded with savings.

If you can’t pay everything up front ask your insurance agent if there are price breaks for quarterly payments instead of month to month premiums.

Evaluate How Much Insurance You Need

We have a tendency to over insure when it comes to our property because either we believe that our stuff is worth more than it really is or we just make a rough estimate on the high side.

Do a complete inventory of your possessions and work from there. Odds are your “estimate” will be much higher than the number you come up with after really looking at the value of your belongings.

Lower Your Risk to Lower Your Premiums

Deadbolt locks, fire alarms, gated communities, fire extinguishers and burglar alarms all help lower your risk of suffering a loss so they help keep premiums low.

Make sure to check with your insurance agency to see what other things can help lower your risk in their eyes.

Raise Your Renter's Insurance Deductible

If you are really looking to cut back on insurance costs the easiest way to do so is to go with a higher deductible.

Unfortunately this means you will wind up having to pay more out of pocket in the event you have to file a claim but if it is short term savings you are looking for this is the best route.

Choose an Actual Cash Value Policy

There are two types of policies, actual cash value that pays you what your belongings are worth at the time of the claim, and replacement cost, that pays you the cost to replace the items regardless of their value.

Obviously the actual cash value will pay far less as things depreciate over time but again, if you are looking for something to lower your premiums immediately this is one way to go.

About Elle Martinez

Elle Martinez helps families at Couple Money achieve financial freedom by sharing tips for reducing debt, increase income, and building net worth. Learn how to live on one income and have fun with the second..

7 comments add your comment

  1. I’d just add that it’s just as valuable to shop around for renter’s insurance as for any other insurance policy. You covered everything else!

    • Very true – it can be tempting to go with the policy that the leasing office suggests, but in most cases that won’t be the best deal.

  2. Good article, but the last point makes me nervous . With my current policy, the difference in cost per month is only a couple of dollars between ACV and replacement cost, and this small savings is not worth the loss of coverage. Maybe Im too conservative in my thinking, but I couldnt replace my computer for its ACV as an immediate example.
    One tip I would add is to check any alumni association or professional associations to which you belong – they often have additional discounts you can receive simply by entering a “code” – mine is an extra 10% from the University I did my Undergraduate degree at, and they have “codes” available for 3 major companies.

    • @Becky: I think Jeff’s last tip was suggested for those really limited on funds. If you can afford replacement value, then I say go for it. It’s a better deal in case of an emergency.

  3. Most definitely Elle. Replacement value pays off in the long run but if you really need to cut back costs as much as possible then opting for the actual cash value policy. If you can afford it, go for the replacement value but for the people who really live on a limited budget it is better to have the coverage provided by an ACV policy as opposed to nothing at all.