According to the Insurance Bureau of Canada, about half of Canadian renters don't have renter's insurance. Many people believe that their landlord's insurance will cover any losses from a disaster, from storm damage to fire.
Major fires like the August 2018 blaze at 650 Parliament St. in Toronto, which left about 1,500 people without homes, highlight the importance of renter's insurance. An electrical fire displaced the residents, who have been told they won't be able to return until June 2019 at the earliest.
Renter's insurance can help after a fire damaged a rented apartment. It can also provide coverage in case visitors are injured while in your apartment, or you've suffered a break-in and theft.
Don't landlords have insurance to cover fire and disasters?
Yes, property owners have insurance for their properties, but these policies cover structural damage and liability related to the owner's responsibilities, not the tenant's.
Many landlord insurance policies in Canada cover damage from water, earthquakes, fire, wind, storms, and smoke. Owners usually have to provide proof to their insurance company that their tenants also have renter's insurance in order to qualify for all policy benefits.
If a disaster has displaced tenants from a rental property, landlords may have coverage that continues to provide rental income during the time tenants can't return to the home. Landlord's insurance also includes liability coverage, in case anyone is injured on the property. Landlord's insurance is designed to cover the landlord's liability, not the renter's. If you're a renter, your landlord's insurance may rebuild or repair the apartment or house when damaged, but it won't repair or replace your belongings, including furniture and appliances.
What does tenant or renter's insurance cover?
Renter's insurance coverage starts with contents insurance. Contents insurance provides funds to replace lost, stolen, or damaged items, from electronics to furniture and clothing. The contents of your home or apartment can be insured for a specified amount, or be insured for replacement cost. Replacement cost coverage means that your belongings are insured for the amount it will cost to replace them.
All-risk renter's insurance policies cover losses from any cause, as long as it's not intentional. Even an unexpected and unusual disaster like a car driving through your living room would qualify for coverage under an all-risk renter's insurance policy.
One of the most important parts of a renter's insurance policy is coverage for additional living expenses. The 650 Parliament St. fire highlighted the importance of coverage for living expenses. Additional living expense coverage made surmounting challenges after the disaster much more bearable.
What about liability insurance for renters?
Many people don't think about personal liability insurance until a visitor is injured. If someone is visiting your apartment and slips and falls, you may be liable for medical costs or replacement of lost wages. Renter's insurance can include personal liability coverage that will cover accidents, unintentional injuries, and mishaps like accidentally leaving the water running and flooding the unit below.
When considering renter's or tenant's insurance, it's wise to consider your personal situation and what kind of coverage you need. Renter's insurance can be very affordable. Compare up to 30 renter's insurance quotes through InsuranceHotline.com.