So you’ve found a great apartment, condo, or house to rent and you’re ready to move in. You’ve heard of homeowners having home insurance, but what about renters?
We’ve compiled the most frequently asked questions about tenant insurance to help you make an informed decision as a property renter.
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What is Tenant Insurance?
Tenant insurance (also known as renter’s insurance or contents insurance) is insurance coverage catered to those that are tenants of a property. Typically it includes three parts:
- Contents Insurance covers loss or damage to your property due to a insured risk. Insuring the actual cash value gives you coverage for the market price of an item had you sold it right before it got damaged, whereas insuring the replacement cost gives you coverage for the cost of replacing an item with a brand new one.
- Personal Liability Insurance protects you from being liable and having to pay if someone is injured, or their property is damaged, while in your unit. A typical plan covers this cost up to $1 million.
- Additional Living Expense pays for a portion your living expenses should you need to vacate your unit due to repairs or other insured risks such as flood or fire.
Do I need Tenant Insurance?
If it isn’t mandated in your lease, the decision of whether to get tenant insurance is up to you. However, take note that there are a few common misconceptions.
Misconception #1: Your Landlord’s insurance has you covered.
Your landlord’s insurance will only protect the building itself and the landlord’s own personal liability in case someone is injured on the property. Your possessions, any liability claims against you, and your expenses should you be forced to vacate will not be covered by that insurance.
Misconception #2: You don’t have enough valuables to justify getting insurance.
People usually think about how many big ticket items they have such as jewelry, TVs, or laptops when debating whether they need tenant insurance. However, if you take a quick look around your apartment you’ll soon realize that all of the little things like clothes, kitchenware, and furniture all add up very quickly. What’s more, tenant insurance covers more than just your possessions, with the typical plan covering you for personal liability up to $1 million.
How much does Tenant Insurance cost per month in Ontario?
Tenant Insurance is much more affordable than home insurance since it only covers possessions, liability, and additional living expenses.
While your exact rate will depend on the extent of your coverage (does it cover a whole list of risks or only the common ones), the upper limit of your contents insurance (which typically ranges from $30,000 to $100,000), and other factors related to your apartment such as age, location, and the amount of people living there; the cost is around $200 per year or $17 per month in Ontario.
As well, you can lower this cost by combining your tenant insurance with your car insurance, or by opting for a higher deductible on your plan.
How do I get Tenant Insurance?
Almost all insurance companies will offer tenant insurance. If you already have car or home insurance, a good first place to check for tenant insurance is your existing insurance company. Often times you can save money by bundling your insurance with the same company.
Otherwise, websites such as Insurancehotline.com, lowestrates.ca, and ratehub.ca are great free resources to compare rates and find the lowest one for your particular financial situation and apartment.
Either way, you’ll need to give the address of your apartment, an estimate of the individual and total value of your possessions, your insurance history, and some other basic information in order to get an estimate and eventually pick an insurance plan.