Does Your Lease Require Tenant Insurance?
When most people purchase a home, they don't think twice about buying home insurance from TD Canada Trust or another top insurance provider. However, renters don't seem to be as aware of the losses they could incur if something were to happen to their home. According to Statistics Canada, fewer than 50% of renters in Canada have tenant insurance even though it is available from all major banks such as CIBC, BMO, RBC insurance and more. Tenants insurance covers all of your personal property inside of a rental and much more, making it invaluable to renters. Here is a better look at tenants' insurance and why you need to take a second look.
What is Apartment Insurance and Is It Required?
Like most insurance policies, there are a lot of add-ons that come into play when you look at a renter's insurance policy, however, in short it is a basic policy that covers your personal belongings in a rental unit. It also protects you as a renter if you damage the building you live in or someone is injured on the premises of your building. Legally you are not required to take out renter's insurance, but some landlords will make it a part of your lease that you must purchase renter's insurance.
Even if you are not legally required to get renter's insurance it is a good idea to at least look into it. Coverage from TD insurance or RBC insurance can start as low as $10-15 a month if you bundle your insurance with other products and give you piece of mind. For instance, RBC insurance can offer you insurance that will cover up to $2,000,000 on your personal belongings. If you do not have personal property valued that high then you can simply choose a lower liability limit and pay a lower premium. The same is true of TD Canada Trust which offers three different plans based on the level of coverage that you want.
What Else Can Rental Insurance Cover?
Outside of simply protecting your belongings, rental insurance protects you against theft or fire. If your building or apartment catches on fire your landlord is not legally responsible for reimbursing you for your losses. Even if they are found at fault due to faulty maintenance of the structure, they do not have to pay for your losses. Therefore, it is vital to have a back-up plan in place by purchasing a policy from TD insurance that will cover you in case of a sudden loss. Keep in mind that your personal property may include costly things such as electronics or jewelry. Having insurance that will cover the value of these items is essential.
Personal property is not the only reason to have renter's insurance, it also protects you in case you need temporary living arrangements. If you are forced to move out of your rental property because of a fire, flood, or other unforeseen circumstance most plans from major providers like TD insurance or RBC insurance will cover your stay at a hotel. Thus, your rental insurance does not only protect your home, but it guarantees that you will never be homeless if something happens to your primary residence.
A Quick Checklist Before Buying Renter's Insurace
Before buying renter's insurance there are a few quick things you are going to want to check out. For instance, if you are a student there is a good chance that the property insurance your parents own may actually already cover your insurance. The Enhanced Plan from RBC insurance for example covers the property of a student that is at college. In this case buying another insurance plan would be redundant.
Second, you need to choose a good coverage number that is realistically based on what you own. You don't want to end up over insured and paying a higher premium than necessary or underinsured in the case of a loss. Typically, people get liability insurance that starts at $1 million while they choose around $25,000 for contents insurance. Read the limits carefully on all policies to make sure that you will not be affected by any of them. (Such as a $3,000 jewelry limit with TD insurance).
Finally, you need to be aware of what the financial costs of a rental's policy are going to be. As mentioned earlier, $15 to $25 is a reasonable amount to pay each month for a renter's insurance policy, but this will fluctuate depending on the size of your property and the deductible you choose. You also need to decide whether you want a replacement value policy from TD Canada Trust or a cash value policy.