Unless you’re aware of the distinction between an apartment and a condo, it’s easy to use these terms interchangeably. While this seems harmless, it actually matters when it comes to buying insurance. That’s because, in Canada, there’s no such thing as “apartment insurance” – it’s either tenant insurance or condo insurance, and if you buy the wrong one, you could end up in a tricky financial spot.
So, how do you know which type of insurance you need? That’s easy. Do you rent or own? If you’re renting your apartment, tenant insurance is what you’re looking for. If you own it, then condo insurance is the one for you. Read on to learn more about the key differences and get a general sense of how much each will cost.
Does your apartment need tenant or condo insurance?
The type of insurance you need for your apartment will depend on whether you rent or own the apartment. If you rent your apartment, you’ll need tenant insurance (also known as renters insurance). However, if you own the apartment, then you’ll need condo insurance.
The reason it is so important to get the right type of insurance is that these two types of insurance are designed to cover different needs. If you mistakenly purchase the wrong type of insurance, you could find yourself without the coverage you need in the event of a claim. For instance, if a condo owner buys tenant insurance, it will not cover the unit’s structure or improvements, leaving you financially exposed.
Moreover, some landlords or rental agreements may require tenants to purchase a minimum amount of tenant insurance, including liability coverage, as a condition of the lease. Similarly, some condo boards may require unit owners to have a specific level of condo insurance.
Condo insurance vs. tenant insurance: what’s the difference?
Although both tenant insurance and condo insurance fall under the umbrella of home insurance, they are not the same thing. They are specifically designed to address the distinct risks and responsibilities associated with renting an apartment or owning a condo. With that in mind, let’s review the types of coverage you can have as an insured renter versus a condo owner.
Tenant insurance (for renters)
As mentioned previously, if you rent your apartment, you need tenant insurance (also known as renters insurance).
Unlike homeowners or condo owners, you are not responsible for the physical structure of your rental unit, as this typically falls under your landlord’s insurance. However, many renters mistakenly assume that their landlord’s insurance will cover their belongings. In reality, it won’t. Fortunately, tenant insurance offers valuable coverage beyond just your belongings, safeguarding you in ways you might not have considered.
Personal belongings: Covers your possessions (ex. clothing, furniture, electronics, etc.) if they are damaged or lost due to a covered peril, such as fire.
Personal liability: Covers you if you accidentally cause injury to others or damage their property. This protection is especially valuable in apartment buildings, where a mishap (like a small kitchen fire or a flooded sink) could affect neighbouring units, quickly leading to significant costs.
Additional living expenses: Covers your daily living expenses (ex. hotel stays, temporary rental accommodation, food, etc.) if your rental becomes uninhabitable due to a covered event, like a fire.
High-value items: Tenant and condo insurance policies often include a maximum coverage limit for high-value items like jewelry, collectibles, or expensive electronics. To ensure full protection for these belongings, you may need a floater. Review your policy to understand the coverage limits and make adjustments if necessary.
Condo insurance (for owners)
In Canada, apartments you own are called condos, hence the term condo insurance. These individual units are typically part of a larger building or complex managed by a condo association.
While your condo association will have a master insurance policy that covers the building’s structure and shared spaces (ex. hallways, lobby, parking garage), their coverage generally stops at your unit’s walls. This means that you need your own condo insurance policy that covers everything inside your condo unit, including your personal belongings and any improvements you’ve made, such as renovations or new fixtures.
Interior fixtures and renovations: Protects your unit’s interior elements (ex. walls, flooring, cabinetry, fixtures, etc.) against damage caused by a covered peril, such as a fire.
Personal belongings: Covers your possessions (ex. clothing, furniture, electronics, etc.) if they are damaged or lost due to a covered peril, such as a fire.
Personal liability: Covers you if you accidentally cause injury to others or damage their property. This protection is especially valuable in apartment buildings, where a mishap (like a small kitchen fire or a flooded sink) could affect neighbouring units, quickly leading to significant costs.
Additional living expenses: Covers your daily living expenses (ex. hotel stays, temporary rental accommodation, food, etc.) if your rental becomes uninhabitable due to a covered event, like a fire.
Loss assessment: Some condo insurance policies offer loss assessment coverage, which helps protect you if the condo association asks owners to contribute additional funds for repairs to shared spaces (ex. the roof of the building) that go beyond the coverage limit of the association’s master policy.
Next steps
Now that you know whether your apartment needs tenant insurance or condo insurance, it’s time to find a policy that offers the coverage you need at a price you can afford. To do that, try using YouSet.
In just four minutes, YouSet’s platform will automatically compare quotes from multiple insurers, apply exclusive discounts, and find you the best available price. From there, you can adjust coverages, modify limits, and customize your policy to ensure it meets your exact needs.
