In 1922, United Services Automobile Services (USAA) was born when 25 members of the U.S. Army formed a small organization to insure each other’s automobiles. What began as a well-orchestrated effort to help fellow Army members later became a booming organization serving all branches of military service.
To illustrate its rich history, USAA includes a timeline on its website to show current and future customers where it came from to get where it is now. USAA is now one of the only fully integrated financial services organizations in the United States and it has a net worth of over $31 billion. The company serves the insurance needs, including renters insurance, of over 12 million military service members. It goes without saying that it ranked in the top 10 of our review of the best renters insurance companies of 2020.
Aside from USAA’s deep American roots, it’s also known for excellent customer service and has a reputation for providing sophisticated technology along with the flexible renters insurance options.
The specs
| Price | Starting at $12 per month |
| Best for | Military members who are renting |
| Not for | Non-military or military homeowners |
| States served | 50 |
| Discounts | Renters and auto bundle discount Monitored security alarm discount |
| AM Best Rating | A++ |
| Standout Features | Long-standing company reputation Excellent customer service Replacement cost coverage Affordable rates Innovative technology |
The claim
USAA offers affordable renters insurance to the U.S. military and their families with more features than many other insurance companies. With one of their renters insurance policies, USAA promises your belongings will be taken care of in the event of damage, theft or destruction.
Is it true?
Our research shows that USAA’s claims are true. USAA offers renters insurance to active duty military, veterans and the families of both. Unlike many competitors, things like flood and earthquake coverage are standard parts of the USAA renters insurance policies.
Because it understands the mobile lives of active-duty military, USAA ensures that all your personal belongings will be covered, no matter where they are located. In addition to the excellent coverages, USAA ranked five out of five in overall satisfaction, policy offerings, price, billing process and policy information and interaction in J.D. Power’s 2019 Renters Insurance Study.
Our deep dive
- Replacement cost coverage: Many insurance companies offer actual cash value policies in addition to replacement cost policies. USAA differs in that it only offers replacement cost renters insurance policies. No matter how old your belongings are, the policy will cover you for what it costs to replace the item with a new one.
- Liability coverage: If someone or their property is damaged while on your property and you are liable, your USAA renters insurance policy promises liability coverage to cover those costs.
- Active-duty, veteran and family coverage: If you are active-duty military, a veteran or a family member of either, you are eligible for USAA insurance. However, if you do not fit into one of those categories, you will not be able to get insurance from USAA.
- Discounts: Though USAA’s discounts may seem limited, remember that they are highly competitive with its affordable rates. Consider bundling your renters and auto insurance and installing a monitored security system to save on a discounted premium.
- Quick turnaround: USAA has claims centers that are open 24/7, which means you will never be delayed in filing a claim.
- Mobile app: USAA offers a mobile app that gives 24/7 access to your insurance documents, claim filing and claim tracking. The app is now also accessible for those with visual impairment through voice-guided technology.
- Military uniform and equipment replacement: True to its roots, USAA offers special coverage for military uniforms and equipment as outlined below and on the website:
- Repairs or replaces military uniforms and issued military equipment at full cost with no depreciation.
- There is no deductible for covered losses sustained while on active or active reserve duty.
- Includes coverage up to $10,000 for damage caused by war.
Cost rundown
While USAA’s renters insurance rates start at $12 per month, there are a variety of factors involved in determining what your rate will be. USAA underwriters will look at things like geographical location, the proximity of the rental unit to fire hydrants and first-responder stations, age of the property and potentially even your credit score.
Your premium cost may increase if you need to add any special endorsements. However, things like flood and earthquake coverage are built-in as a part of USAA’s standard renters insurance policy.
Cheaper (or free!) alternatives
Here are some ways to make USAA renters insurance even more affordable:
- Consider bundling your renters and auto insurance to save money on your annual premium.
- Install a monitored security system to save money on your annual premium.
- While it is important to have adequate coverage, don’t overdo your personal property coverage. Make an inventory of all personal property before seeking quotes.
- Monitor your credit score and make changes necessary to improve your score.
The competition
- Allstate: Allstate offers renters insurance coverage that is comparable to that of USAA, but with the added bonus of several discount options like a multi-policy discount, safe home discount, easy pay plan discount, 55 and retired discount and claim-free discounts. However, Allstate got below-average rankings nearly across the board in the J.D. Power’s 2019 Renters Insurance Study, which assessed customer satisfaction in a variety of categories.
- Erie Insurance: Erie Insurance, like some of its competitors, has been around for more than 90 years. Its local agents are known for providing personalized customer service. Erie’s renters insurance policy offerings are comparable to that of its competitors, and Erie received average to among-the-best ratings in all categories of the J.D. Power 2019 Renters Insurance Study.
- Nationwide: Nationwide Insurance is a nationally recognized name in the insurance industry, making it a competitor of USAA for renters insurance policies. It offers a variety of options on renters insurance policies, and things like theft extension for your belongings in any motor vehicle, trailer or watercraft. Nationwide also offers several discount options to lower your annual premium. However, on the J.D. Power survey, Nationwide scored below average across the board in all categories assessed.
- State Farm: On J.D. Power’s 2019 Renters Insurance Study, State Farm gets five out of five ratings in every category except claims. In that category, State Farm ranks two out of five, which represents below-average customer feedback on their claims process. While State Farm is inferiorly ranked in claims, we consider State Farm a competitor of USAA due to its long-standing history, reputation for good service and comparable renters policy options.
What others are saying
For the 2010-2018 time period, USAA received the highest scores in Satmetrix Net Promoter Benchmark Study. Between 2016 and 2019, USAA earned a ranking in the World’s Most Ethical Companies. These accomplishments are representative of USAA’s service excellence. Its No. 100 Fortune 500 rating in 2018 is indicative of superior financial strength.
In 2019, USAA was awarded the 2019 Gallup Great Workplace Award and FORTUNE’s Best Workplaces in Finance and Insurance Award. USAA also received a 100 percent rating on the Human Rights Campaign Foundation’s Corporate Equality Index. While these awards may not be directly related to USAA’s renters insurance policies, they are representative of the type of company USAA is and the morals it is founded on.
The bottom line
Renters insurance is a critical part of protecting your financial well-being. With a great reputation for customer service and flexible policy offerings, USAA is an excellent choice for renters insurance if you are a current or former military service member.
The post USAA Renters Insurance Review 2020 appeared first on The Simple Dollar.
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