Contrary to common belief, insurance isn’t just for those who own a home or a car. Tenant insurance—interchangeably known as renter’s insurance—exists to protect renters and their belongings against theft, liability, and damage. One of the ways in which tenant insurance differs from something like auto insurance is that it’s usually not mandatory and it is up to renters to decide what kind of coverage they need or if they need coverage at all.
Read on to find out what renter’s insurance does and does not cover, how to get a quote, and some best practices that will ensure you’re getting the best deal possible for the coverage that you need.
How does tenant insurance differ from home insurance and what does it cover?
Although many insurers classify tenant insurance under home insurance, there is a big difference between the two. Unlike home insurance, tenant insurance does not include coverage of the physical property. Any liabilities to the structure of the rental building—such as damage to walls, floors, fixtures, and heating and cooling systems, caused by the elements or otherwise—should be covered by your landlord’s insurance. Conversely, tenant insurance protects the renter against personal liability, as well as their belongings.
Let’s get into some examples. The most common way in which tenant insurance can be beneficial is by providing coverage of your personal belongings, such as furniture, entertainment equipment, technology, and jewellery. If your items happen to be affected by flood, fire, or theft, they can be covered by a tenant insurance policy. And depending on the nature of your policy, you may also be covered if any of your possessions are stolen when you’re travelling.
Tenant insurance can also protect you if someone is injured in your rental unit or if some type of damage is incurred to the rental property and you are found to be liable. This is known as personal liability insurance. Additionally, if your rental unit is deemed unliveable due to a loss that’s covered in your policy, tenant insurance would also cover reasonable living expenses, such as temporary accommodations, transportation, and meals. This is known as additional living expense coverage.
Getting a quote for tenant insurance
If you have an insurance provider in mind, you can simply visit that provider’s website to request a quote. You will likely have to provide some basic information that will determine the types of policies that you are eligible for. From there, most companies will provide several options for a quote, which can then be customized based on your needs.
Below, we’ve included some things that insurance providers take into consideration when giving a quote:
- The size of your space. The larger your space, the more it will cost to insure.
- Whether the unit is in the basement. Basement apartments are more susceptible to flooding and that added risk will be reflected in your premiums.
- The location of the property. If you’re living in a neighbourhood with a high crime rate or near a body of water, risk of break-ins and/or flooding will be reflected in your premiums.
- The age of the property. Newer buildings with newer mechanical systems and appliances are considered to be less risky, and therefore less costly to insure.
- Your claims history. If you’ve made any claims in the past five years, your insurer may infer increased risk, and your premium may be higher as a result.
Best practices for tenant insurance
Pay your premium annually rather than monthly
Depending on your provider, you may be eligible for a discount if you pay your premiums annually in lump sum. But this is not the best option for everyone. Paying annually will require you to have enough savings built up to withstand a large withdrawal.
Customize your policy to cover only what you need
Tenant insurance coverage is not a one-size-fits-all affair. When requesting a quote from an insurance provider, make sure you know what you want covered, as well as what you don’t need covered. Knowing this information could help to shave off unnecessary extras and reduce your premiums.
Compare, compare, compare
Just like you would if purchasing a home or a car, you can and should shop around for insurance plans and providers. Additionally, some companies might be willing to price-match a cheaper premium offered by a competitor or offer a more competitive deal, so it can be advantageous to have a lay of the land before making your final choice.
Get a policy bundle
If you already have a good car insurance plan with a provider, check with the company to see if they offer any bundles that include both car and tenant insurance. Having two coverages with one company will not only simplify the process, but you may also be eligible for a discount or loyalty related perks.
Request/consent to a credit check
While some companies require a credit check before offering coverage, for others, credit checks are optional. If you have good credit, consider requesting and consenting to a soft credit check. A soft credit check won’t affect your credit score and a good credit score can end up decreasing your premiums.
Do your homework when it’s time to renew your policy
Insurance policies usually have a one-year term, which gives you the opportunity to shop around for the best deal each year. If you’re sticking with the same company for consecutive years, stay on top of your premiums to ensure that there aren’t any unexpected or unnecessary increases. Additionally, if your situation changes in any way, it’s a good idea to reevaluate your policy options to ensure you are equipped with coverage that will protect you properly.
Are you looking for a rental apartment in Sault Ste. Marie, Niagara, Sudbury, or Hamilton?
If you’re interested in a redefined rental experience, we offer renovated rental apartments in sought-after neighbourhoods in Sault Ste. Marie, Niagara, Sudbury, and Hamilton. From top-of-the-line finishings to energy-efficient appliances to digital amenities, our units have been upgraded to reflect the unique values of today’s tenants. Get in touch today to find out more about condo-style apartment living with CPM Properties.