Many renters might think that their landlord’s insurance is enough to protect them if something unfortunate happens to the rental property. While you do get some protection, it’s mainly for the benefit of your landlord, and it doesn’t include coverage for you as a tenant.
The importance of renters' insurance shouldn’t be underestimated - you should take out a policy even if you’re just starting out. It safeguards more than just your belongings. It protects you from the risks associated with renting someone else’s property and provides you with personal liability coverage in case you’re considered responsible for damages to your unit.
What is renters' insurance?
Renters' insurance, also known as ‘tenant insurance,’ is an insurance policy designed for those who don’t own their own home and, instead, rent it. It complements a landlord’s insurance policy to provide coverage for your personal belongings such as clothes, dishes, and furniture as well as personal liability.
Renters' insurance protects more than just your belongings
Renters' insurance generally provides coverage from risks associated with being a tenant of a property that’s not your own. It typically includes two basic coverages for your personal belongings and personal liability.
Personal belongings coverage protects your belongings in case of damage or theft, even if you’re away when the event happens. Personal liability coverage also protects you if anyone at your rental property is unintentionally injured or if you have damaged someone else’s property and now have to pay for damages.
It’s important to be aware that coverage varies per insurance provider and individual policy, so the extent of protection you get may differ. It’s best to consult with your insurance representative and review your plan to ensure that you’ve covered all your bases.
We’ve tackled what’s covered under rental insurance in another blog post, so let’s discuss what’s not included. Tenant insurance usually doesn’t allocate coverage for certain incidents (earthquakes, floods, sinkholes, and sewage backup), pest infestations, damages to the building, vehicular damage, and your roommate’s belongings. That said, you may be able purchase additional coverages that can extend your coverage for these circumstances and conditions to boost your overall protection. Be sure to speak to your insurance representative to find out more.
Renters' insurance is more important than you think
As a tenant, you’re legally liable for any damage you cause to your rented unit and those who are in it. Renters' insurance makes sure that you have some support when something unfortunate happens - it’s a smart, cost-effective way to safeguard your personal belongings.
Here are some reasons why it’s important to have renters' insurance:
Personal liability
This coverage protects you if anyone at your rental property is unintentionally injured or if you have damaged someone else’s property and now have to pay for damages.
Landlord requirement
Some landlords in Canada require renters' insurance from their tenants. Not having this insurance may make it difficult for you to find a property to rent.
Is renters' insurance mandatory in Canada?
No law in Canada mandates renters to purchase tenant insurance. However, it’s completely legal for landlords to require it from renters and even ask for proof of renters' insurance before allowing someone to rent a unit.
Regardless of the requirement, it’s best for any renter to have renters' insurance to help protect themselves, their property, and the people in and around their rented property.