What is Tenants or Renters Insurance?

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What is Tenants or Renters Insurance?

Moving out on your own is a big first step. Many Canadians choose to rent their first place as it’s often more affordable than buying a home. However, just because you don’t have a house doesn’t mean you don’t need to insure your home. Tenant insurance is like home insurance that’s designed for people who rent instead of own. In the event of something unexpected that causes damage to your apartment, without tenant insurance, you could find yourself paying out of pocket to replace all your belongings. Also, if someone were to injure themselves in your apartment, you may suddenly find yourself paying expensive legal fees.


That’s why it is essential for all tenants to have a tenant’s insurance policy to cover repairs and replacement costs within their rented unit. Your policy will protect you from insured perils, such as fire, theft and liability coverage claims.


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Is there a difference between renter’s and tenant’s insurance?

Nope. Tenant’s and renter’s insurance are terms often used interchangeably by insurance companies. While they both mean the same thing, tenant’s insurance is more commonly used in Canada, while Americans often prefer renter’s insurance.

Is tenant insurance mandatory in Ontario?

The province of Ontario does not require renters to have tenant insurance. However, while it is not legally required, it is a crucial investment for any renter.

Most rental properties are at a greater risk of damage due to the close proximity of their neighbours. If a fire starts in the apartment next door or the unit above you has a water pipe burst, it could quickly reach your place and cause significant damage to your property. While you aren’t required to pay for the damage to the building caused by a burst water pipe or another renter’s fire, you would have to pay out of pocket to replace anything of yours that was damaged. Without insurance, it can be very expensive to replace everything you own unexpectedly.

Also, suppose you were to suddenly find yourself displaced because your apartment is temporarily unlivable due to an unexpected event, such as a fire or burst water pipe. In that case, tenant insurance cover temporary relocation costs, such as:

  • Short and long-term rentals (e.g., hotel fees, motel fees, etc.)
  • Food costs above what you would typically spend (e.g., having to order takeout instead of being able to cook)
  • Travel costs above what you would typically spend (e.g. more gas for commuting to work)
  • Storage costs (e.g., temporary storage unit for belongings that weren’t damaged)
  • Moving costs should you need to find a new rental unit.

Moreover, tenant insurance coverage can protect you in the event of unexpected liability claims, such as a guest of yours injuring themselves while visiting or a fire that starts inside your property, reaching another unit and damaging their possessions. Legal fees are also costly and can be extremely difficult to cover without insurance.

Lastly, some property owners may deny your application if they have tenant’s insurance as part of their lease agreements. Tenant insurance may not be mandatory, but landlords are legally allowed to require it. They want to know that they are protected, too.

Who pays for accidental damage to a rental property?

You. Most of the time, tenants are responsible for paying for any accidental damage caused to their rental property, whether by:

  • You
  • Your roommate(s)
  • Your pet(s)
  • Your visitor(s)

Some examples of accidental at-fault damage include:

  • A tenant runs a bath and forgets about it, causing the tub to overflow and drain into the apartment below.
  • A roommate throws a party where some guests get out of control and end up putting a hole in the unit’s drywall.
  • A tenant accidentally starts a fire by knocking over a candle or burning something in their oven.
  • A pet damages the walls or floors (e.g., scratching, misuse of the litter box, chewing, etc.)

Am I covered under my roommate’s insurance?

Never assume you are automatically covered by another renter’s policy. While many insurance companies allow roommates to share a tenant insurance policy, the policyholder has to call the company and add their name to it. However, renters insurance cover may be limited to how many people a policyholder can add, so keep this in mind if you rent a place with several roommates.

However, you should be aware of the risks of sharing insurance. If your roommate files a claim, it will be reflected in your file. This can lead to an increase in insurance premiums.

How much tenant insurance do I need?

The amount of coverage you will need depends on how much stuff you have and what situations you want to protect yourself against.

As tenant insurance protects your contents, you need to determine how much your belongings are worth so you can purchase enough insurance to cover the replacement cost if they are lost, stolen or damaged. You can accomplish this by cataloging everything you own with photos and receipts if you have them. This task may sound daunting, but it will ensure you get the necessary amount of coverage. It’s always best to catalogue everything before disaster strikes instead of after, as it’s more challenging to remember what you had after it’s destroyed.

Is landlord protection insurance related to tenant insurance?

Landlord insurance and tenant insurance are two separate policies that can work together to cover damages to a rental unit. The landlord insurance policy is bought by the owner of the building, while the people who rent the unit purchase tenant insurance.

The major difference between the two is that landlord insurance does not protect the tenant. At all. Landlord insurance protects the building structure in the event of a fire, lightning strikes and vandalism. It also sometimes covers any furnishings that were already in the rental unit before the tenants moved in. It does not, however, cover any of the tenant’s personal belongings or liability coverage claims.

What is the difference between homeowner insurance and landlord insurance?

Homeowner insurance covers the owner’s primary residence and contents, while landlord insurance protects rental properties. Remember that if your tenants are renting out a space within your primary residence, such as a room or a basement apartment, your homeowner insurance will not extend to them. You will need landlord insurance to protect your personal property and should consider requiring tenant insurance from your renters for further protection.

Homeowner insurance includes coverage for personal belongings, while landlord insurance does not. Landlords do not live within the unit they are renting, so their coverage only extends to the building itself, such as the structure of the building and the walls, floors and cabinetry. Landlords will often cover the appliances or furnishings as well that are included in the rental lease. Tenants are responsible for protecting their personal belongings.

Do tenants pay house insurance?

No. Generally, the landlord is responsible for purchasing home insurance when renting out a house to tenants, as the landlord is the owner of the house. However, as mentioned before, they will likely require you to have tenant insurance to not only protect you and your belongings but also protect them from having to pay for damages or liability coverage claims as well.

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Tenant insurance is an essential purchase for all renters to ensure protection for themselves and their belongings. As most renters are at a higher risk of sudden unexpected damages, it’s important to have that peace of mind of knowing you are safe. Partnering with Oracle RMS for your tenant insurance can give you just that and more.

So, if you ever find yourself asking, “do I need tenant insurance?” Ask yourself this: can you afford to pay tens of thousands of dollars in a worst-case scenario? If the answer is no, then don’t hesitate. Get your free tenant insurance quote today!

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