10 Reasons Why You Need Tenant Insurance
Whether you are renting your first home, a student living out of town, or are moving on up to a more prestigious address, if you are a tenant, you need insurance. Many tenants are under the impression that if something happens to their rental home; their landlord’s insurance will cover it. However, your landlord’s insurance only covers damages to the structure.
Any other damage caused to your personal belongings whether it is due to fire, flood or a break-in is your responsibility. This puts you at risk for great loss if you don’t have tenant insurance. Although it seems like an unnecessary added expense, here are 10 reasons you really do need tenant insurance.
Your landlord’s insurance doesn’t cover you
We’ve mentioned this before, but we’re mentioning it again as it’s very important. Everything you own is at risk of being lost or damaged if you do not have insurance. That means no clothes, no jewelry, no electronics, no furniture – the entire contents of your home could be lost due to fire, flood or vandalism/break-ins.
Also, even if your landlord was responsible for damages such as not maintaining the property and there is a flood as a result, your contents are still not covered. You would have to sue them to get the money and although you might win, it’s still a hassle to go through.
During this time you would have no clothes or other lost personal items as you wouldn’t have the funds to purchase them.
You could be liable for damages
Tenants have a responsibility to their landlords to protect the property they are renting from damages while they live there. That means if you do cause damages you could be on the hook to pay for those damages.
In most cases, you might have left a deposit, but there is no guarantee the damages you cause are covered. If you didn’t leave a deposit, the cost gets even higher. So, what are some examples of negligence?
- Leaving the water on so it overflows into your apartment or worse, onto your neighbour’s unit
- Damage caused by smoking
- Starting a fire
- Pet damages such as urine stains
The list is endless.
It covers your personal property
There are a lot of scenarios that can put your belongings at risk including:
- Power surges
- Water damage
- Fire and smoke
All of these issues are covered by most tenant insurance policies.
It can cover specific high-risks
In the case where you might be at higher risk for things not covered, like floods.
A good example of where this is advised would be if you live in a basement apartment as this can increase the risk for floods and water damage. However, there can also be a risk for floods in high rises such as condos where they used Tyvek plumbing, or where apartment units have their own laundry machines and dishwashers.
Shelter following fire or flood
You’ve seen the news and have seen the tragedies not just of lost items but also a loss of home. If your building did experience an issue such as fire or flooding, or even a situation like a tree branch crashing into your roof, although the landlord has to pay to repair damages, you will have to find somewhere to live while the repairs are made.
If you have a loss of use and need to find temporary shelter, your tenants’ insurance will cover your living expenses including a safe hotel, food, and other related expenses.
Good for pet owners
If you have a dog, tenant insurance will help cover liability for instances where your dog causes injury to a neighbour or even a neighbour’s dog.
Additional coverage for specialty items
There are also add ons for expensive items from jewelry to art and customized electronics to home entertainment items. You might want to consider specialty coverage to include borrowed items. For example, maybe you are using a borrowed laptop in your apartment or a friend forgot their phone at your home when the event occurs.
Some landlords require it
You might be surprised to find out that more and more landlords require their tenants to have a minimum amount of tenant insurance coverage. It is usually included in the tenancy agreement and if you don’t abide, this can lead to an eviction.
So, make sure you ask this question or check the lease carefully before signing it. Keep in mind this is not a requirement by the government, but a choice the landlord makes.
It’s very affordable
Having to pay out more money to insurance might seem like another major expense, but many policies can be as little as $12 per month. In fact, you might even find you get a better deal on your auto insurance when you decide to purchase a tenant insurance policy.
This is because we might be able to find a deal for you for buying multiple policies. This is common with many insurance companies who want to encourage their customers to use more of their products.
Some factors that will affect price include:
- How much coverage you choose
- Where you live
- Type of rental home such as high-rise apartment, condo or house
- The insurance company
- Your insurance history
- The purchase of other policies
You can choose from various policies including:
- Liability to protect from accidents causing injury to a person or damage to their property
- Contents to cover all of your personal belongings in your rental home
- Additional living expenses to provide accommodations, clothing, personal hygiene items, food, etc. should you be unable to live in your home during repairs
Peace of mind
Tenant insurance provides you with peace of mind. Whether you are faced with a fire, a break-in or damage from a storm, you’ll know that your belongings are protected. You will also have somewhere to live thanks to the additional living expenses provided when you are temporarily removed from your home due to a disaster.