How Does Tenant Insurance Work?

Are you renting your home? Here are some reasons why you should consider getting a tenant insurance!

Home insurance isn’t mandatory in Canada like it is for autos. Therefore, tenant insurance isn’t a prerequisite to rent. Yet, during these uncertain times, more landlords and tenants buy home insurance. In this article, you’ll read all about it and why it’s a smart move.

Protection Matters

Tenant insurance isn’t a legal requirement to rent a home. Yet, there’s an increasing number of landlords including this insurance in the contract. Some tenants opt to purchase their insurance independently. Typically, prices are pretty affordable, ranging between $15 and $20 per month.

This kind of insurance protects tenants from catastrophes like floods and fires. It covers property losses amounting to values from $20,000 to $30,000. Additionally, it protects you from personal injuries, covering medical expenses for you and your guests.

Extreme and unpredictable weather events are leading to an upward trend in home insurances. In regions that are more exposed to floods, hurricanes, and so on, the prices are skyrocketing. In the face of potential property losses, $15 per month seems reasonable for all involved parties. If you’re looking for tenant insurance, don’t forget to check BrokerLink for the best options.

Potential Scenarios

You’ve probably heard that insurances are taxes you pay for things that are unlikely to happen. Although this statement has some truth to it, it’s always better to be covered when the unlikely happens. Here are some ordinary things that can go wrong in your daily life and may require an unexpected expense.

Let’s say your guest suffers a dog bite on your property. Medical expenses can be around $35,000. Insurance costing about $200 per year can protect you from such costs. Sometimes, even a leakage coming from your neighbor can get you off guard. Insurances cover this kind of damage up to $10,000, for $150 per year approximately.

Small Business and the Insurance Problem

More frequent natural disasters and the world crisis are leading more small businesses to seek protection. According to the Canadian Federation of Independent Business, insurance prices have risen since the beginning of the pandemic.

The sudden rise in prices didn’t go unnoticed. Nearly 50% of small business owners reported that insurance costs were becoming a burden. In some cases, increases reach 300% when renewing the policy. Some insurance companies aren’t even offering coverage for restaurants and bars anymore.

Choosing the Right Coverage

Don’t be let down by your insurance company when you need it most. There are some common mistakes people make when buying renter insurance. Learn how to avoid them below.

Shop Around

Not all tenant insurances are born equal, and finding the best deal may require some legwork. All companies will take your claims history, among other risks, but each company does so differently. Compare.

Don’t Underestimate Your Property

Your insurance is calculated based on the value of the property you wish to insure. If you underestimate the value of your possessions, you can end up with an ineffective policy. Typically, $100,000 in personal liability coverage suffices most needs.

Mind the Deductibles

The amount of money you must pay yourself when making a claim is called a deductible. A higher deductible value usually leads to lower costs.

Conclusion

Renter insurance is a pretty inexpensive way of protecting yourself and your property from damage or theft. Even the smallest problems from our everyday lives can lead to unexpected expenses. Tenant insurances are becoming a trend in a world full of uncertainties and natural disasters.