8 things you didn’t know about tenant insurance
Renting your home, as opposed to owning it, is still the reality for many people. And while home ownership is often touted as one of the main goals of adulthood, there are plenty of reasons why people rent and are quite happy doing so. Perhaps you’re saving up for a down payment and renting a cheaper apartment for now, or perhaps you’re planning to move around a lot in the next couple of years and prefer the flexibility of renting versus buying. Perhaps you’re a fresh university graduate and just getting started in a new city, or perhaps you simply don’t want to deal with the stress and expenses that come with maintaining a property.
Whatever the reason, having tenant or renter insurance should always be a part of the equation. Tenant insurance protects your personal belongings from theft, loss, or damages, and protects you in case you or a guest cause unintentional damage to the building or the property. But while you might have guessed that tenant insurance is a good idea to have, here are some things you might not have known about this type of protection:
1. Some landlords require you to have tenant insurance
While tenant insurance is not required by law, owning a policy may still give you a leg up in a competitive housing market. Landlords are naturally more inclined to go with tenants who are insured, since it also represents less of a risk for property owners. In some cases, landlords might even ask to see proof of insurance as part of your lease agreement. So if you’re currently looking for a place in a town with a heated rental market, definitely don’t forget to bring proof of policy along with your application materials.
2. Your insurance can cover your belongings even when they’re not in your home
Most people know that tenant insurance protects your personal belongings in your home. So if your apartment gets broken into and the thief damages or steals your stuff, you’re eligible to be compensated. But did you know that this kind of insurance can also protect your stuff if it’s in storage or in transit during a move, while you’re travelling, or in your car? While every policy is different and it’s important to know exactly what’s covered for your individual case, this kind of protection is often offered by different providers.
3. You are not protected by your landlord’s insurance
A common misconception among renters is that a landlord’s insurance also protects against any damages to a renter’s unit. This is unfortunately not really the case. If your flat gets broken into or your personal property is otherwise damaged, a landlord’s building insurance will not cover you. Most landlord insurances only cover structural damages to their property, and if you or a guest caused any damage, you’re on the hook for that as well (unless you have the protection of your own).
4. There are different reimbursement methods
Most insurances give you a choice as to how you’d like to be compensated in case you submit an accepted claim. You’ll usually be given the choice between replacement value compensation or cash value compensation. While cash value sounds pretty good at surface value, keep in mind that this simply means that you’ll receive a cash compensation in the amount of the item’s value at the time you purchased it. So if you bought a laptop for $400, you’ll receive $400, regardless of whether that laptop now costs $500.
If you choose a replacement value compensation, however, you’ll get compensated for the amount it would take to replace that object right now, regardless of how much it was worth when you first bought it. So if you own things that are likely to be more expensive to replace in the future, it may make sense to go with replacement value compensation.
5. You and your guests are protected
Tenant insurance does so much more than just protect your stuff. If you accidentally cause a small fire thanks to a chaotic barbeque you hosted on your balcony and damaged part of the building’s outer wall, you’re liable for the damages. Thankfully, your insurance will cover those damages. The same goes for your guests: If they’re the ones who started the fire, you’d still be on the hook for the repair costs. Unless you have insurance, that is.
6. Tenant insurance includes personal liability coverage
Another important aspect is the personal liability coverage usually included in your policy. In addition to covering any damages you may cause to the building you live in, you’re also covered in case someone hurts themselves in your home. Without insurance, you could be sued and forced to pay for your medical bills. But if you’re covered and your guest trips over your box of novelty snowglobes that you’ve been meaning to get rid of and chips their tooth, you won’t have to worry about any pricey medical bills coming your way.
7. You’ll need extra policies for natural disasters
While your insurance will cover damages caused by fire, smoke, and water damage from leaks, it will usually not cover damages caused by natural disasters such as floods and earthquakes. If you live in an area where the risk of these kinds of disasters is high, then you may have to purchase additional coverage for these events.
8. It’s affordable
Tenant insurance in Canada can range, on average, from $12 to $25 a month. That’s about two takeaways a month. And we’re pretty sure your pad thai isn’t exactly helpful when someone broke into your flat and stole your laptop. And if you’re wondering where you can get the best coverage at a price that fits your budget, we can help you out. At YouSet, you can instantly compare different tenant insurance policies and find the one that best suits you, at a guaranteed best price. Curious? Come check us out!
With YouSet, get a free online quote for an insurance that suits your needs and budget, in only 4 minutes!