How much is renters insurance?

“There is a heightened risk if you don’t have your renters insurance,” says Elliot Silverstein, the director of government relations at CAA Insurance. “Your property—like jewellery, electronics—is protected from fire, smoke, flooding, theft and so forth.”

He adds that COVID has likely increased the value of your goods, like the new tech gear for your home office, and the special cooking appliances you’ve added to your foodie repertoire (how did you live without that air fryer!). Having these pandemic “must-haves” is another good reason to take inventory of your property and budget for a policy.

How much is renters insurance?

Across Canada, renters insurance can range from $15 to $50 per month. But generally, Silverstein says, “if you have a lot of possessions, you’ll be paying more.”

Unlike with home insurance, when you have renters insurance, the type of building you live in doesn’t matter. Why? Because you’re getting the contents insured, not the space itself. However, do ask about discounts if you live in a condo or apartment. For example: If you have a security guard or concierge in your condo or apartment building, it could save you some money. It’s worth noting that many insurance providers require a minimum coverage, like $40,000. So it may be worth looking into providers who do not have a minimum coverage, should your belongings be worth less.

Your postal code factors into the cost, too. Do you live in an area with high risk of theft, or where there is a higher chance of water or sewage overflowing into your ground-floor apartment? Are you a vintage jewellery collector, a sports fanatic with prized memorabilia or an audiophile with loads of rare vinyl? These are all situations that cause your premium to inch up with insurance add-ons to increase the limits on prized collections.

With a few clicks you can scroll rates online to get a picture of your cost. Then, typically, you will be directed to a broker who can help you negotiate the right coverage and find savings like bundling your renters insurance with your auto insurance. Associations you belong to—such as your union, college, university or recreational club—can sometimes bring more savings too. 

“In general, you don’t seek out insurance on a regular basis. It is a complex conversation and an insurance agent or broker can help you customize your policy,’ Silverstein adds. Note, even when you use an online quoter, you will be directed to an insurance broker to work on and finalize your insurance policy. 

A final tip: Make sure you can afford the regular cost and the deductible. A standard deductible is $500. If you don’t think you’ll have those funds handy after damages or a loss, keep shopping around for a renters policy that’s a better fit for both your monthly and emergency cash flow. But know that a lower deductible can increase your monthly costs, so weigh your options and what makes sense for you. 

What is renters insurance?

According to the Insurance Bureau of Canada, a tenant is “legally responsible for any damage you cause to any part of your building and for unintentional harm caused to  others who live in or visit the property.” That’s a mouthful, so let’s explore what is covered by rental insurance and what isn’t.

Generally, a basic policy has you covered in three ways:

• Liability coverage or tenant liability insurance foots the bill for legal fees and pay-outs when someone sues you after hurting themselves in your rental. That accident can be as simple as tripping over a rug corner or slipping on a freshly polished floor.
• Contents insurance covers the value of your goods, whether they need to be replaced or repaired. “Take inventory of what you have and make sure you know what needs to be covered,” advises Silverstein. “Having an estimated total value is important as well.”
• Additional living expenses cover hotel bills, restaurant meals and moving expenses when your residence isn’t liveable. For example, if your condo is damaged by a neighbour’s toaster fire, you won’t have to sleep on someone’s couch while your place is being repaired. Instead, you’ll rest in suite comfort until you can move back home.  

What isn’t covered? To many people’s surprise, coverage for sewer backup and overland water damage (insurance-speak for floods) is optional in a home renters insurance policy. Water damage may be covered with home insurance, especially if the source is a burst pipe or leaky appliances. As for floods, the potential damage is specific to where you live and some may require more coverage than others, but it can be added to your policy at any time. 

Watch: What is tenant insurance?

If you live in an area with limited rainfall, like Okanagan, for example, you don’t need maximum coverage because there’s likely only sewage backup or a washer overflowing to worry about. On the flip side, if you live in a ground-floor apartment next to a creek that can flood your home after a heavy rain, you’ll need extra coverage. (Do you live in an area at risk for earthquakes? Find out.)

Sharing these details when comparison shopping for renters insurance will help you make an educated decision and figure out what’s best for you.  

Is renters insurance mandatory?

Across Canada, renters insurance is not compulsory; however, Silverstein cautions landlords and property management companies can request it as a condition of moving in and signing a lease.

It’s important to note that you are not breaking the law if you don’t have renters insurance. However, if it is a requirement stated in your rental lease and you don’t have a policy, you will be in breach of contract and risk being kicked out of your home.

What happens if you don’t have renters insurance?

If you don’t have renters insurance, you won’t find a cheque in the mail or an e-transfer to help cover any repairs or damage to your personal property when something happens. And don’t rely on your landlord’s contents insurance to cover those losses, either. That policy covers the belongings a landlord owns in the building, for example, the fridge and the stove they outfitted your kitchen with, but not the items you bring into the rental—think your TV or your laptop.

Landlord insurance also pays for the cost of repairs and replacements to the building and outside structures, like a deck or garage, that’s been damaged by a fire, vandalism, theft or a fallen object. 

When it comes to the hotel bill from moving out while your unit is being repaired, that’s when you can count on renters insurance to swoop in with some funds. If you don’t have a policy, you’ll have to settle for couch-surfing or doling out your own money for an Airbnb.