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Landlords often wonder how to protect their properties from damage. Whether focused on natural disasters striking or unruly tenants, you consider all the options.
Though you have landlord insurance (or should), renters insurance coverage is also a smart solution to your problems. However, you might not buy it yourself. Instead, you would require your tenants to purchase renters insurance to protect their personal belongings and damages to your premises if they or their guests break things.
Today, you'll learn more about cheap renters insurance in California and why you should require your tenants to buy it. In fact, you can ask them to read this article to learn more about it and why it can benefit them!
What Is California Renters Insurance?
California renters insurance is protection that covers many unexpected events. Primarily, tenants buy renters insurance to receive liability protection, personal property coverage, and additional living expenses when the need arises.
Overall, renters insurance is similar to other kinds of insurance products; it's bought in the hopes that it's never needed. However, it can be quite handy in various situations.
Though it's not required by law, landlords can make tenants have and keep renters insurance to protect both parties in case of an accident. It's important to know what coverages are available, and we'll discuss that below.
Average Cost of Renters Insurance in California Per Year/Month
How much is renters insurance? This is a question many Californians have. According to Quadrant Information Services, the average annual cost for renters insurance is $192, which makes the average monthly price $16.
Though it's helpful to know the average cost of renters insurance in California, your policy might be more or less based on your rental's size, specific location, and discounts or endorsements you choose.
Likewise, the average monthly price you pay for renters insurance varies based on how much personal property coverage you require.
How Much Does California's Renters Insurance Cost (Based on Popular Cities)?
You may also wonder: How much is renters insurance in California based on the city?
According to Lemonade, the average cost of renters insurance in California by city can range from $177 annually to $273. Therefore, you're paying an average monthly price of $14 to $22. Let's break it down for you:
- San Diego - $14/month or $177/year
- Los Angeles - $22/month or $273/year
- Fresno - $17/month or $201/year
- San Francisco - $18/month or $211/year
- San Jose - $17/month or $200/year
Is Renters Insurance Required in California?
Many people often ask: Is renters insurance required in California? Let's focus more on this for a minute.
Though renters insurance isn't required by law in the state, landlords can demand tenants have renters insurance before signing the lease. They also have the right to check up on tenants to ensure they continue holding policy. This means they can request proof of the policy before renewals and signing of new leases.
Tenants are required to comply with the lease. Therefore, if you have terms or clauses requiring renters insurance, they must be covered.
As a landlord, you want to ensure the tenant has personal property coverage in the renters insurance policy. This will protect the tenant and you against lawsuits, damages, and other issues. Likewise, you can also require the tenant to list you on the policy. It's called being an "interested party," which gives you notifications of changes or cancellations.
What Does Renters Insurance Cover in California?
You might be wondering: What does renters insurance cover? Most renters insurance companies will protect tenant's possessions, though there could be circumstances that the policy won't cover. These could include wildfires and earthquakes. You'll learn more about that below. Here's what renters insurance will likely cover:
Personal Property Coverage
Personal property means all of the tenant's possessions, regardless of where they are at the time of a covered loss. If a burst pipe ruins their kitchen table or a laptop was stolen while they were on a trip, renters insurance will cover those things.
Medical Payments Coverage
If the tenant invited guests over to their place, and a friend fell and had to go to the hospital for stitches, renters insurance will cover the medical payments. It works for any injuries to guests and non-residents, but it also helps if the tenant hurts someone outside the home. However, renters insurance doesn't cover the medical costs for anyone on the policy.
Liability Protection
When guests get hurt at the tenant's property, they could be held liable. Therefore, if someone is injured or anyone on the policy causes damage to other people's things, the renters insurance policy will cover those events.
Loss of Use
In some cases, apartment buildings or rented homes are unlivable after covered losses, such as windstorms or fires. Loss of use coverage will pay for basic living expenses and a place to stay while the building is repaired.
What Does Renters Insurance in California NOT Cover?
Typically, the cheapest renters insurance companies offer very basic coverage for a low price. However, tenants may find that certain situations aren't covered. Here are the circumstances where tenants may need an endorsement or separate policy for coverage:
Wildfires
California wildfires have become more frequent and larger in recent years. In fact, they have caused significant damage. Most renters policies will cover damages from smoke and fire, but if the tenant lives in a high-risk area, they might have problems finding options.
The FAIR Plan is California's state insurer, and it offers renters insurance to those who can't get help elsewhere. However, it's a last resort. Most insurance companies will provide wildfire protection as a separate policy or an endorsement/rider on a current policy. Tenants can ask their agents to see what's available to them.
Earthquake Coverage
Typically, earthquakes aren't disasters normally covered under renters insurance. Therefore, if the property is in a high-risk area, the tenant will need extra coverage to be protected.
Flood Coverage
California properties near the coast are prone to flooding, but most renters insurance policies won't cover this natural disaster. However, tenants can purchase flood insurance as riders or endorsements. Likewise, they can go through the National Flood Insurance Program from the US government to get coverage.
How to Choose the Right Policy
When browsing the many California renters insurance companies available, it's hard to know which brand is best. The state is often associated with warm weather and sunshine, but there are also wildfires and earthquakes to consider. Therefore, tenants should have renters insurance and can select the right policy using these tips:
- Coverage Options - Though tenants often want the cheapest renters insurance possible, the price they pay correlates to how much coverage they get. Landlords can require them to have specific amounts of liability and personal property protection.
- Deductible Amount - The deductible is the amount of money a tenant must pay first before renters insurance kicks in. Typically, they can lower their California renters insurance rates if they choose a higher deductible for a lower insurance premium.
Overall, it's a balancing act. Tenants have to think about how much it would cost to replace everything if it was damaged by a covered event. Likewise, they may require endorsements and riders to protect against things like flood and earthquake damage.
Available Discounts in California
Each California renters insurance company has its own discounts and pricing structure. It's important to view each brand and see what it offers.
Here are the more common renters insurance discounts available:
- Multipolicy bundling (car and renters insurance)
- Being claims-free for a period of time
- Having safety devices installed in the building, such as security systems, burglar alarms, smoke detectors, and sprinklers
- Saving money when the tenant uses Autopay features
- Discounts for seniors
- Lower renters insurance rate for a higher deductible
Remember that if the tenant chooses the cheapest renters insurance they can find, they might not have access to multiple discounts.
How Does a Renters Insurance Policy Protect the Landlord or Property Manager?
As the landlord, you have the right to require tenants to maintain renters insurance while living on the property. However, you may wonder why it's so important. Though you can guess why tenants might want it, you also have to know why you're making them get it. Here are the reasons why renters insurance is beneficial to you:
- Protects a tenant's personal belongings
- Reduces the risk of a lawsuit for the landlord
- Protects landlords from personal liability
- Covers relocation costs so that you don't have to
- Makes it easier to allow pets
- Helps identify more reliable and trustworthy tenants
Top 5 Best Renters Insurance Companies in California
Whether tenants want cheap renters insurance or something more comprehensive, here are the best renters insurance companies available in California:
1. Lemonade
Lemonade's cheap renters insurance is the top choice for renters insurance in California. The average rate is $9/month, which is less expensive than other options.
Overall, Lemonade provides a streamlined quote process, making it more convenient. Plus, it often approves claims fast because of its use of artificial intelligence (AI). Tenants can find various coverage options, including earthquake coverage, water backup coverage, and more. Their personal property will be protected against many covered events!
2. Allstate
Allstate offers great renters insurance in California and has excellent customer service. In fact, tenants can easily download the app to track the value of their personal property and inventory it with ease. Claims are usually processed quickly, and there are more than 14,000 claims center employees to assist.
Likewise, Allstate offers multiple discounts, but it lacks in the quote process. Most estimate don't detail the coverage options, and there's no earthquake coverage, even as an endorsement or separate policy.
3. Amica
Amica is one of the top options for renters insurance in California because of its customer service. It rarely gets complaints, so customers are generally satisfied with the brand.
Customer service is something to consider because, after an event, the tenant will be distraught and want help quickly.
However, if you're looking for the best cheap renters insurance available, Amica isn't it. The brand is more expensive than other companies listed here. Plus, it doesn't offer more than the standard coverage and has few discounts.
4. Travelers
Travelers has been in business for 168 years, so it's an experienced brand. When tenants need renters insurance in California, this is a great choice. It offers many deductible options, which allows tenants to customize their premiums based on how much personal property they have.
Though the renters insurance coverage is great, there aren't many discounts available!
5. Nationwide
Nationwide can help tenants protect their personal belongings with its renters insurance coverage. In fact, it has many endorsements available, so renters can quickly fine-tune the coverage they need. However, it's not the cheapest, though it is worthwhile for people who want the most protection possible.
What Is DoorLoop?
Making sure your tenants have renters insurance in California is crucial. However, you may need help keeping things organized to know who has what. DoorLoop is here to assist! This all-in-one property management solution works for all types of landlords. It doesn't matter if you have a mixed-use portfolio or solely manage commercial/residential properties.
With DoorLoop, you can:
- Create rental agreements.
- Manage all your maintenance requests online (which reduces the need for tenants to call or text).
- Manage your rental portfolios.
- Provide tenants with an online tenant portal.
- Collect rent automatically.
- Get a customized and free website for tenants to apply online and for you to market your vacancies on Trulia and Zillow.
- Manage accounts and accounting.
Many landlords feel overwhelmed, and DoorLoop can take some of the hassle out of their jobs. Are you ready to learn more? Schedule a demo today!
Why Work with DoorLoop
Most tenants won't get renters insurance coverage if they don't have to do so. However, if you put it in the lease, they must comply. Make it easier for them by showing them this article to learn about everything.
Likewise, you can use DoorLoop to require tenants to get a renters insurance policy. They can submit their own companies and information, but the software also lets them apply directly on the tenant portal through Lemonade or SURE or on the tenant application itself.
Renters insurance is important for both landlords and tenants. Help your renters by learning about DoorLoop today!
Frequently Asked Quesitons
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