The best Tenant and renters insurance is relative to your risk exposure and requirements. This means that labeling something as “best” is subjective based on your needs. Being the best tenant insurance company would demand superior skills and workflows that include competent and friendly claims service, competent insurance assessment and tenant insurance coverage, or it could also mean the most affordable.
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Insurance products are often bundled with others to provide a savings opportunity to the insured by combining multi-line insurance policies. Having multi-line insurance policies from the same insurance carrier often results in big discounts that bring down your tenant’s insurance premium. For example, most insurance companies offer a 10% to 20% discount for bundling your vehicle and tenant insurance together.
Defining the “best” tenant insurance hinges on so many personal factors, such as risk tolerance and the amount chosen for your deductible or even the amount of insurance coverage required for your contents.
Renter’s insurance or tenant’s insurance policies are not created equally. Some tenant insurance policies offer cheaper prices for less insurance coverage, while some will charge more.
Other names for Renters Insurance
Renters insurance is technically known as Tenant insurance. It’s also referred to as Contents insurance or Apartment insurance.
Tenant and Renters Insurance Coverage
Renter’s insurance is very similar to other types of home insurance but excludes coverage to the actual building itself. Suffice to say that since the building belongs to someone else, insurance coverage for the building would be purchased by the property owner. But like other habitational insurance policies, tenants insurance addresses other risk exposures a tenant could face.
Tenants Liability: protection from liability you’re legally liable for, subject to conditions, limitations, and restrictions. Tenants liability coverage usually applies anywhere in the world! An example would be accidentally knocking over an old lady causing her to break her hip, while on vacation overseas. Your tenant insurance policy should respond in defending a claim, including expenses and third party indemnification up to policy limits.
Tenant Content Insurance Coverage: protection for your personal contents and belongings is probably the most notable feature of tenant insurance. Most tenants who purchase renter’s insurance do it mainly to protect their property. Some may or may not know the additional features and benefits of tenant’s insurance and may not be taking full advantage of their tenant insurance policies. Speak to a licensed insurance representative to get fully informed.
Actual Cash Value and Replacement Cost in Renters Insurance
Tenant insurance claims are adjudicated and settled based on the concepts of Actual Cash Value or AVC and Replacement cost. Replacement cost is the actual cost to replace something at its pre-loss condition and does not factor in deprecation in determining a settlement amount. Tenant insurance policies sold on replacement cost, tend to be more expensive but offer better insurance coverage.
A tenant’s policy that insures your belongings based on ACV, rather than replacement cost, will probably cost less compared to a tenant policy based on replacement cost. Actual cash value represents the cost of replacing the damaged item, of similar like, kind and quality, less depreciation.
Additional Living Expenses in Tenant Insurance
Tenant or Renter’s insurance includes a special coverage named “additional living expense”. Additional living expense insurance coverage is found usually on all home insurance and habitational insurance policies. It provides insurance coverage for any extra expense you might incur while your dwelling is considered unfit for occupation, and the evacuation from your dwelling is caused by an insured peril. An example would be having your neighbour’s apartment flood your unit to the point where you cannot occupy the space. Additional expense insurance coverage would help for lodging and food, over and above what you normally would pay if the loss did not happen.
Additional living expense coverage in a tenant’s insurance policy is usually a percentage of the contents coverage you purchased, rather than the building as in a homeowner’s insurance policy. For example is the tenant policy covers your personal property, or contents up to $100,000, and offers 20% of the content value towards additional living expenses that would be 20,000 that could be applied to that coverage if needed.
Finding the Cheapest Renters Insurance
Finding the cheapest renters insurance requires the same thoroughness in shopping for any other insurance product. Getting tenant insurance quotes from various distribution channels such as:
Company agent – insurance agents exclusively sell products of the company they work under
Insurance Broker – insurance brokers have can have several distribution agreements with many insurance companies, allowing for more flexibility and options for you. However, not all insurance brokerages are created equally. Some have more or less selling relationships with insurance carriers than others, meaning more or fewer options for you, including prices! Shop around and get quotes from every brokerage and direct insurers as possible. Shopping around is the only way to get the cheapest tenant’s insurance.
Tenant Insurance Quote
Finding the best tenant insurance quote involves shopping as thoroughly as possible. Every insurance company in Canada is different and charge different prices for varying degrees and types of tenant insurance coverage.
Tenant/Renters Insurance FAQs
What is renters insurance?
Renters insurance is also known as tenant or contents insurance is a form of habitational insurance policy designed for people who do not own their own home. The tenant’s insurance policy is made for people who rent or lease their homes and excludes insurance coverage to the building itself. Simply put, you cannot insure something that belongs to someone else. There are exceptions to this but usually seen in commercial insurance policies.
Do I need renters insurance?
Renters or tenant’s insurance is not legally required according to most residential tenancy laws but that doesn’t mean you shouldn’t purchase it. Some people may argue that because they may not own much personal property a tenant’s insurance policy is a waste of money or not pertinent to them. This couldn’t be further from the truth.
Renters insurance covers more than just contents:
1. It protects you against your personal liability anywhere in the world
2. It provides Additional Living Expenses coverage for lodging, extra expenses incurred from eating out, should your rented dwelling become unfit to live in. An example would be if your building caught on fire and was unfit to occupy until safe to do so.
3. It protects your contents or personal property
4. Peace of mind
How much does tenant insurance cost?
The average cost of tenants insurance is roughly $200 a year, or between $15 to $20 a month, for one million liability coverage, and $100,000 in contents coverage, according to the Globe and Mail.
Other factors that can affect the price or cost of tenants insurance include:
-Your postal code
-Amount of contents coverage required
-The insurance company filed rates
-Your insurance history (i.e. past claims)
-The type of structure of your building
Is tenant insurance mandatory?
Tenants insurance is not mandatory by law but could be required by your landlord or property management company to include into the terms of your lease or rental agreement.
Although tenant insurance may not be mandatory it doesn’t mean it’s a good idea not to have it.
Is renters insurance worth it?
Renters insurance or Tenants insurance is worth it. Not only are you protecting yourself and your belongings, but you’re also being financially responsible.
The cost of a tenant insurance policy is very affordable and when combined with a multi-line policy discount from the same insurance carrier it almost works out to be free.
Having tenant insurance can also help build a history of home insurance. This can help you reduce your premiums of the future by establishing a positive history of habitational insurance.