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Inverter-based microgrids are an important technology for sustainable electrical power systems and typically use droop-controlled grid-forming inverters to interface distributed energy resources to the network and control the voltage and frequency. Ensuring stability of such microgrids is a key issue, which requires the use of appropriate models for analysis and control system design. Full-order detailed models can be more difficult to analyze and increase computational complexity, hence a number of reduced-order models have been proposed in the literature which present various trade-offs between accuracy and complexity. However, these simplifications present the risk of failing to adequately capture important dynamics of the microgrid. Therefore, there is a need for a comprehensive review and assessment of their relative quality, which is something that has not been systematically carried out thus far in the literature and we aim to address in this paper. In particular, we review various inverter-based microgrid reduced-order models and investigate the accuracy of their predictions for stability via a comparison with a corresponding detailed average model. Our study shows that the simplifications reduced order models rely upon can affect their accuracy in various regimes of the line R/X ratios, and that inappropriate model choices can result in substantially inaccurate stability results. Finally, we present recommendations on the use of reduced order models for the stability analysis of microgrids.