If you are leasing or renting your apartment or home, you should have your own insurance policy in place. You might think that because your property manager is legally obligated to acquire coverage of the place in which you are living you have protection against potential losses, but this is not true for everything that you own. In fact, rental property insurance may only cover damages to the physical structure of where you live and not your contents or your liability.
As a tenant, you will want to ensure you’re in good standings should anything happen to your belongings or if a legal situation arises. Here is why every tenant should invest in renters insurance.
Renters insurance is necessary for legal reasons.
Did you know that if something happens to a guest in your home or unit compensation might be sought through your liability insurance? Since a claim would be filed against you and not against the company or property manager you would be responsible for payment. In this case, it is recommended that you acquire at least $1 million in liability coverage to protect yourself against the unexpected.
Liability coverage may also supply peace of mind in knowing that you are insured in the event of a significant loss. You may want the freedom of not having to worry about what you may do should anything disastrous occur unexpectedly.
Having renters insurance secures personal property.
As your landlord or property manager will have insurance to cover the physical building, you need to acquire coverage for your own belongings. If a fire broke out which caused significant damage to your unit or home your landlord’s insurance may be able to cover the cost of repair, but your personal items – i.e, your laptop, your clothes, appliances, and so on – may not be included with this protection. Renters insurance may include coverage for your personal belongings wherever you are, which can be a great added bonus if something should happen to your valuables while on vacation.
If something should happen which causes your place of residence to be deemed temporarily uninhabitable your renters insurance may be able to offer reimbursement for any temporary living expenses you might incur.
It might be required.
With the ever-tightening rental market, more and more property managers, landlords and renters are restricting their conditions when it comes to lease agreements. In this case, many places may require that you purchase renters insurance before you are able to sign a lease. Some landlords may be eligible for discounts if they require tenants to carry their own insurance, so this is becoming more and more popular. It also reduces their responsibility.
With renters insurance, you will not need to depend upon the good will of your property manager. Instead, that role shifts over to the insurance company. In the event of an accident, both you and your property manager may be having to deal with your respective losses, so they are not likely to be wanting to tackle the hassle of yours.
Renters insurance is relatively affordable.
While the amount of coverage that you need may vary from person to person, most renters insurance is affordable and provides enough protection for you to have peace of mind without a huge price tag. Your renters insurance will likely depend on a number of variables, including your claims’ history, the place you live, your lifestyle, what you need covered, the protection plan you choose, and more.
Your location will factor into how much you pay, too. For example, renters insurance may be different than renters insurance in any other province because of rental costs, location-specific natural disasters, and more. Certain areas may see higher crime rates, too. Discuss with your broker for tips and tricks on how to make your insurance coverage more affordable without needing to sacrifice any coverage.
Overall peace of mind.
Like with any insurance, the real benefit is in the peace of mind you get knowing that your personal belongings and liability are covered. While you might think that you are taking all the precautions necessary to prevent an incident (which you should be doing anyway!) there is no real way to predict whether or not a financial loss could occur. Vandalism, fires, natural disasters, and lawsuits are all accidental and can happen with any amount of preparation beforehand.
It’s not just you, either. Your landlord will certainly have peace of mind in knowing they won’t have to deal with your losses as well as their own and this may help to strengthen your relationship with them. In the end, it’s a win-win for both you and your property manager!