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Minimum insurance coverage for 4 policy types

Renters insurance: The price is right
Renters insurance: The price is right © Monkey Business Images/Shutterstock.com

Ah, renters insurance! Finally, a completely disposable policy, right?

Well, it depends on how much you value your stuff.

"People completely underestimate the value of their personal belongings," says Lynne McChristian, Florida representative for the Insurance Information Institute. "Even college students who think they don't own much -- the fact is, if they had to replace any of those items that they took to the dormitory or off-campus housing, that's a pretty good chunk of change they'd have to pay out."

There are three other reasons to consider spending a couple hundred dollars a year for renters coverage, McChristian says: It's inexpensive; it covers personal belongings wherever they roam (unlike auto coverage, which may not cover possessions that aren't installed in the vehicle); and it includes liability.  

"If you were cooking and left something on the stove, you've got liability for causing that damage," she says. "It's not only about the stuff; it's also about the liability."

Best options: Go bare if you dare on renters insurance. But if you have possessions that might be costly to replace, such as high-end electronics or collectibles, or if you're prone to sleep through kitchen fires, rejecting even the minimum insurance coverage could prove a costly mistake.

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