From a fire to a flood -- just a single incident can completely destroy your home and its contents.
Unfortunately, some new renters mistakenly believe their valuables are covered by their landlord -- but that's rarely the case. You should have tenant insurance to protect you and your property. The exact figures are not known, but it's estimated about half of all renters don't.
Anne Marie Thomas is with InsuranceHotline.com and says unfortunately many renters are unaware they won't be covered if they lose their contents due to smoke damage or an unforeseen incident.
More importantly they could be held liable if someone gets hurt in their apartment or if they leave the bathtub running and damage other units in a building.
"The cost for tenant insurance is relatively cheap for the protection it gives you. You can have $40,000 contents coverage and $1 million liability coverage for as little as $20 to $25 a month."
Students away from home at college or university may be covered through their parent's home insurance policy -- something worth checking to save you buying insurance you may not need. Rates will differ depending on where you live, but if you rent, getting tenant insurance could give you peace of mind.
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Key Points:
- Tenants can be liable or legally responsible for any harm they cause to any part of the building or to others who live there
- Landlords actually have few legal obligations to compensate tenants for damage or loss of their personal possessions
- The two main kinds of insurance coverage include Basic Liability coverage and Contents coverage
- Basic Liability covers any damage to the building caused by you or your guests, whether it's to the individual unit or the whole building
- Contents coverage replaces your belongings if they are lost or damaged
- If you're a student living away from home while attending school, you may be covered for liability and contents under your parents' homeowners' insurance policy
- Coverage can be on a "named perils" or "all risk" basis. The first type of policy covers only events that are specifically named in the policy while the second covers a more extensive list of possible events
- If your home is not in liveable condition, you may need to move to a hotel or another furnished apartment
- Some tenant's policies will cover additional living expenses such as meals at a hotel and extra rent or room charges
The Insurance Bureau of Canada has the following suggestions for taking inventory of your possessions:
- Take the time to make a record of all your possessions to minimize the stress later
- Keep any bills, receipts, warranties and instruction manuals as they can serve as proof of ownership
- Keep this information in a safe place such as a fire-proof box or a safety deposit box
- Take pictures or video footage of all your valuable possessions
