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3 Smart Reasons You Need to Invest in Renters Insurance

renters insurance

You almost expect every homeowner to have insurance for their property, but did you know that most renters don’t have coverage for their belongings? This gap in coverage means renters are at an extreme financial disadvantage compared to their property-owning counterparts.

You might be under the impression that you don’t need insurance. But how much would it cost to replace everything in your home? Here’s everything you need to know about investing in renters insurance.

What Does Renters Insurance Cover?

As with most insurance policies, you can select different types of renters insurance depending on what you own and your financial situation.

There are three components of tenant insurance you can combine to create a custom policy:

  • Contents coverage: This is the bulk of a renters insurance policy, and it covers all of the belongings in your home, up to your coverage limits.
  • Personal liability: This will cover injuries you cause to people visiting your home, as well as damages you cause to their property, up to your coverage limits.
  • Additional living expenses: There might be multiple add-on options to cover your living expenses, like a hotel or moving costs, if a covered event makes your home inhabitable.

Every insurance provider will have different coverage options and limits available. They will also have coverage limitations and exclusions, so review the fine print carefully.

Why You Need to Invest in Renters Insurance Today

Tenant insurance is a financial tool that pays for losses you incur because of a covered event. But what could happen that you’d need coverage for your furniture?

1. Extreme Weather Patterns are Becoming More Common

Changing weather patterns are increasing the number of extreme weather events across Canada. While 2019 closes out the hottest decade on record, the Western provinces experienced some of the coldest spells under heavy snowfall in the early spring. In Southeastern Canada, many cities faced some of the biggest floods in decades, and the warming climate threw heatwaves, tornadoes, and wildfire at the Arctic regions.

In 2019, these extreme weather events caused $1.3 billion in insured damages. Severe storms caused the most damage, at $536 million of total losses. Renters insurance helps recover the costs of property that your landlord isn’t obligated to cover.

2. Replacing High-End Technology and Furniture Can Be Costly

Think about all the technology and furniture you own. Do you have a 4K TV, a MacBook, and an assortment of gadgets to enhance your experience? How much did you spend on your mattress, couch, and washer/dryer? If there was a fire in your apartment, can you afford to replace those things with your savings?

Tenant insurance premiums can start at just $23 per month. Of course, that amount varies based on where you live and how much coverage you choose. Contents damage limits range from $10,000 to over $100,000, while personal liability limits are generally $1,000,000 and can go higher if required.

3. Apartment Complexes Offer Substandard Coverage Options 

While renters insurance isn’t required by law anywhere in Canada, your apartment complex or landlord might require it. They have their insurance policies to cover damage to the property caused by natural disasters or maintenance issues, but tenant insurance gives them coverage in case you cause damage to their property.

In some cases, your apartment complex or landlord might offer you a coverage option that you pay a marginal fee for. This fee is to help recover any damage you cause to their property but doesn’t cover your property. Renters insurance covers both your property and damage you cause to theirs.

How an Insurance Professional Can Help You Choose the Best Coverage

Unless you sell insurance, it’s difficult to keep up with all of the different options. An insurance professional understands the intricate complexities of the industry and they can guide you to the right types of coverage, as well as the most appropriate coverage limits.

Are you in the market for a new tenant insurance policy? Get a quote with Higgins Insurance today to protect your future.