5 Reasons Why You Need Tenant Insurance
When renting a house or a condo, buying tenant insurance probably isn't one of your top priorities. But many people don’t know the truth about tenant insurance — while others don’t even know it exists, let alone what it can do for them.
As a broker, our purpose is not about making a sale but about helping you, our customer, when you need it the most. Tenant insurance, in particular, is critically important and a life preserver for those who’ve lost everything.
By having a discussion with your broker on the value of tenant insurance, you’ll fully understand the repercussions when damage occurs at your rental building or to your rental unit.
Our goal is to help you understand what can happen if you don’t have any insurance. You could lose all of your possessions, be without housing and potentially be exposed to legal liability as a renter.
Here are five insights about tenant insurance that will ensure your most valuable assets are covered if you’re faced with a worst-case scenario such as a fire.
1. Your landlord doesn’t have you covered.
Many tenants believe that their landlord’s insurance will cover the cost of replacing their possessions if anything happens to the building they occupy. This is not true.
If your possessions are stolen, damaged or destroyed — due to fire, water damage, smoke damage, a break & enter or other scenario — your landlord isn’t responsible for covering the cost of replacing your possessions. If you’re uninsured, you will lose everything.
2. Your belongings are worth more than you think
Most people don’t realize the value of what they own — or the replacement cost to buy it again. If you are unconvinced you need more than $10,000 in coverage because you ‘don’t own a lot of stuff,’ consider this…
How many pairs of jeans do you own? How much did each pair cost? Five pairs at $100 each adds up to $500. Tally up the cost of all other clothing, electronics, sports equipment, dishes, bedding, towels, small appliances and furniture — and you’ll see that $10,000 is very inadequate to replace everything in your apartment if you lose it all in a fire.
3. You’re legally on the hook for property damage.
As a tenant, you're often expected to put down a security deposit when you move in and you may mistake that as a form of insurance. A security deposit covers minor damage to the rental unit (such as a hole in the wall), but tenant insurance covers major damage you accidentally cause to the rental property (such as fire) and unintentional injury caused to visitors (such as a slip and fall).
And in terms of legal liability — you could be sued by other tenants in the building or even your landlord!
4. Your landlord isn’t responsible if you’re forced to move out.
Even if you already have insurance, you may not understand the difference between coverage for contents and coverage for additional living expenses. For example, a building could suffer extreme fire damage that requires extensive reconstruction or repairs. If you have insurance to replace your belongings, you may think your landlord’s insurance will cover your expenses if you have to move out.
Naturally, many people think about their contents first, but they overlook additional living expenses. This is why you need both, you’ll need enough money to cover you while your building is being repaired or rebuilt.
As tragic as it may be, this is why we will always ask you to consider what you would do if your home burned to the ground. You may have sufficient coverage to replace your possessions, but do you have enough to cover additional living expenses if you're forced to move out temporarily? Could you afford to stay in a hotel or other temporary rental unit for six months — and replace all your possessions? How would it affect your kids’ ability to get to school? What about your dog? You need to think about every possible scenario.
5. It’s more affordable than you think.
We know there are lots of people who don’t care about what an insurance policy looks like, and most don’t want another bill added to their monthly expenses. But we're here to help you understand the risks of being uninsured and help you put it into perspective.
To avoid the headache of replacing all your belongings and putting a dent in your wallet, call us at 905-433-4200 and speak with our Oshawa insurance experts at Petley-Hare today.