Imagine a scenario where your rental home experiences a devastating fire or flood and all of your personal property is damaged or destroyed.
Statistics Canada estimates that less than half of Canadian renters have tenant insurance. This is likely because many tenants are under the assumption that a claim would be covered under their landlord’s home insurance policy. For these people, it would be horribly disappointing to discover that there was no coverage for everything they own. Starting from the ground up and replacing all of your clothes, furniture and electronics would carry a large price tag that many renters wouldn’t be able to afford on their own.
A tenant insurance policy is an affordable way to protect yourself in a total loss situation. For about $200-$300 a year, or for as low as $16 a month, you can get a policy that not only covers your personal property (to a desired limit) but also provides coverage for legal liability.
When setting up a tenant policy, you get to choose the amount of coverage you require in order to replace all your personal property, as well as an affordable deductible. In the event of a claim you would get back what was lost, up to your set limit, minus the deductible.
The policy also provides protection in situations where a tenant is found legally liable, or at fault, for any damages that happen while you’re living in the rental home. For instance, if cooking dinner leads to an accidental fire in the home, the landlord is within their rights to sue the tenant. A tenant policy comes with a minimum of $1-million in liability to cover legal costs and settlements if you are to find yourself in a legal dispute. This is another misconception, as people think they can’t be found legally liable if they don’t own the home.
Those who rent a basement apartment might find the water coverage to be the most useful part of their tenant policy. If water damage occurs from flooding, sewer back up or a foundation leak, a tenant policy provides coverage to your property. This coverage is optional, and can be opted out of if you feel it’s not necessary for your current situation.
Landlords should also be aware that their tenants are not covered under their residential policy. In the event of a loss, only the building and appliances would be covered.
When setting up a policy for owners of rental properties, we routinely remind them that they should ensure the tenants get their own policy to avoid any issues in the future. We also suggest going with a higher limit of liability, as the price is minimal for the additional coverage limit.
In our agency, we want our clients to be covered and have peace of mind, whether they’re homeowners or renters. Connect with us today to find out how we can create a policy that meets your needs and protects you from any potential losses.
Get more information about tenant insurance policies here: https://www.cooperators.ca/en/Insurance/home/home-property/tenant-insurance.aspx