The limit for contents under your tenant insurance is not automatic - you must choose the correct amount of coverage.
When purchasing tenant insurance coverage you must choose the amount of coverage that is appropriate for you. Many people underestimate the value of their contents resulting in insufficient coverage.
Good advice would be to complete a inventory of your belongings to better determine the proper amount of insurance. Here is a copy of an inventory sheet you will find helpful.
Don't forget that your belongings will be insured for replacement cost so when you value your belongings use the replacement cost value in determining your insurance needs.
Tenant insurance provides the same type of coverage as a home owner's insurance policy.
You will be offered either named perils coverage or comprehensive coverage. The comprehensive coverage provides much better theft, disappearance and accidental damage coverage for your personal belongings and is usually what most people purchase. Besides, the difference in the premium is quite small. The most common claim for tenants is theft so comprehensive coverage provides better protection for the most common claims.
Tenant Legal Liability Insurance
First off, when you rent a space you may be held legally responsible for damage to the property if you do something that causes the loss. The most common example is someone falling asleep with a lit cigarette, or leaving a candle near a curtain that causes a fire or smoke damage. The damages that others suffer because of your actions can sue you in court.
The building owner likely has the building insured. The insurance company would repair the damage under the landlords insurance. However, the insurance company can take you to court and sue you for the amount of money they paid to fix the property you damaged. Tenants Legal Liability in this example would come to your rescue. It would pay the legal costs and the settlement to the limit insured.
Personal Liability
Any time you are sued on a personal level there is a chance that your personal liability insurance provided under your tenant policy will protect you. Personal liability is the same for both home owners and tenants. Something happens in your suite and someone is injured, your dog bites someone, you volunteer to help out at a function and things go wrong, you are driving a borrowed boat and you run into another boat or a skier, you are accused of slandering someone. All of these things are likely covered under your liability policy.
Liability does not provide physical damage coverage on any automobile, boat, ATV, golf cart, or things that you own, rent or borrow. You must insure them, or the person you borrow or rent from must have coverage.
The most important aspect of Liability insurance is that it provides legal costs. Anyone can sue you and you have to defend yourself in court. These costs can be quite large. Having your legal costs covered certainly reduces the stress you have to endure from mounting legal bills.
Special Limits of Insurance
Depending on the company, the special limits of coverage (jewellery, professional property, Bicycles, etc) may have low maximums. A review of the special property limits is in order. Here is a link to information on special limits of insurance and what it means. Belongings What you need to Know.
Sewer Backup
It is imperative that homeowners have sewer backup coverage on their homes because of the likelihood of a sewer backup. It is not always apparent that a person who rents a suite really needs coverage. It is obvious that those who are renting a basement suite need the extra coverage, but what about those who are above ground? If the suite has a toilet overflow due to blockage all of the suites above it contribute to it. NO, you do not have to worry about the damage to the flooring and walls but you do have to worry about your personal belongings. The cost of sewer backup is much lower than what it costs for homeowners. You are usually looking at an additional $20 premium to get the coverage.
Replacement Cost
A majority of policies do provide replacement cost automatically. Not all policies offer it especially if you rent a mobile home or an older home that does not qualify for regular insurance. If you rent a location above a store or other commercial operation you may not be able to get replacement cost insurance.
Property in Storage
Personal property stored in commercial storage unit may not have coverage under a tenant policy. In addition, property stored in a vacant property (such as a unoccupied farm yard) is not covered under a tenant policy and coverage must be requested and endorsed under the policy.
If you have property in storage make sure you check to see if coverage is provided under you tenant policy.
Automobiles are insured under your automobile insurance policy. Whenever your auto policy is not in force your auto is not insured. So if you have seasonal vehicles that you do not insure all year round, they are not insured under your tenant policy. Motorcycles, ATV's, snowmobiles, private passenger vehicles, etc must be insured under an automobile policy. In Saskatchewan one may insure their ATV under the home policy.
Review the home insurance blog for other information on specific coverage. Most of the posts there also apply to tenant insurance.
Here as some we feel you should review.
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