Tenant insurance (often referred to as renter’s insurance), is a very inexpensive way to protect the value of your personal property, should it be damaged, destroyed or stolen.
Do I Really Need Tenant Insurance?
Although you may not own the building in which you live, you still need to protect your personal property from fire and other damages, as well as theft. In addition, potential liability risks exist, against which you need to be protected. It is true that your landlord’s insurance protects his/her property from loss, but it does not cover your property or personal liability exposure.
If there was a fire in your apartment and the contents suffered water and smoke damage, could you afford to have the contents cleaned or replaced? Could you afford to pay for temporary accommodations and any additional living expenses? If a visitor to your apartment tripped and fell, breaking his leg due to your negligence, would you be able to pay for his medical bills or for the time he loses from work? If you answer no to these and similar questions, you need tenant or renters insurance.
What Does My Tenant Insurance Cover?
A basic insurance policy covers such things as your: furniture, clothing, electronic equipment (TV/VCR/DVD, stereo), appliances, and other personal belongings, such as clothing. The coverage applies to your personal property in your rental residence, and it also provides limited coverage for your property that you may take with you when you are away from home, such as on vacation.
Tenant insurance covers your property for “named perils” that are caused by:
- Fire and lightning
- Windstorm or hail
- Riot or civil commotion
- Vandalism and malicious mischief
- Accidental discharge or overflow of water or steam from plumbing, heating or air conditioning systems
- Freezing of the plumbing, heating or air conditioning systems
- Artificially generated electrical current
Damages or “perils” that are not typically covered include:
- Sewer back-up*
- Power failures
- Nuclear hazard
- Intentional acts
* Note: Protection against these perils may be added to your insurance coverage.
Other Coverage Considerations
Replacement Value: Replacement cost coverage means that the insurance company will pay you what it will cost to replace your damaged or stolen property without a deduction for depreciation.
Liability: Your tenant policy also protects you from personal liability. You could be liable, (held legally responsible), for accidents that occur in your residence due to your negligence, or if you accidentally start a fire that damages your neighbour’s property. It will also pay the cost of an attorney to defend you and will pay any judgment against you, up to the limits of the policy. Even if you are not negligent, your policy will typically pay the necessary medical expenses incurred by someone other than yourself or a member of your household if they are injured in your home.
How Much Coverage Do I Need?
Each person’s situation is different and we are happy to review your needs with you and explain your options. For example, do you need coverage for high value items, such as: jewellery, gold and silver, cameras, etc.? If yes, you may need higher dollar value limits for these types of items, than provided in the basic policy.
Home-Based Business: Do you run a home-based business from your rental residence? If yes, then you will most likely need extra coverage to protect your business property that you keep in your residence. Without this added insurance, your business equipment, computer software, merchandise, and samples would not be covered.
Additional Living Expenses: Your tenant insurance also includes this coverage for loss-of-use. If a fire, water damage, or any covered loss prevents you from living in your home or apartment, this coverage pays for the additional living expenses you might incur so you can continue your normal standard of living.