Understanding Tenant Insurance

Did you know that you can get insurance even when you’re renting your home? Or have you always assumed that you are fully covered under your landlord’s home insurance policy? Many people are unaware of tenant insurance and its importance in ensuring your assets are covered in case of a disaster.

A home office with bookshelves and a chair

What Is Tenant Insurance?

Aptly named, Tenant Insurance protects the belongings of the tenant to ensure that their contents in their rental space are protected in case of any damage occurring to the home. Tenant Insurance also includes liability coverage, which means you are protected against legal action that your landlord may want to take as a result of any damage that may have been caused while renting.

Another aspect of Tenant Insurance policy is the Loss of Use. Loss of Use is also known as Additional Living Expenses (ALE), which covers any increase in living costs if you temporarily are unable to live in your home due to a disaster. For example, if there is a fire in your home and you need to stay in a hotel while it is being repaired, you may not have access to a kitchen and would have to eat at a restaurant. In this case, ALE would then cover the increase in your dining expenses.

A lady looking for tenant insurance online

Why Do You Need It?

The landlord’s responsibility is only limited to protecting their own home (i.e. the building itself and their own contents). That being said, your own possessions in your rental space are then your own responsibility. By not purchasing Tenant Insurance, you may be risking the possibility of major financial loss in the case of a disastrous event.

If You Do Have Tenant Insurance, Do You Have Enough?

Depending on the financial scale of your belongings, you may require additional coverage within your policy. Therefore, it is always important for you to keep a frequently updated list of your important belongings and have a quick chat with your insurance broker to see if its value exceeds the limit offered within your policy.