Tenant Insurance Toronto

Renting a home in Toronto comes with risks that many aren't prepared for. But, with the right coverage, you can have peace of mind knowing your personal belongings and financial interests are protected against the unexpected.

Whether you're a first-time renter or not, understanding how tenant insurance works and how it can benefit you is important if you're considering this type of coverage. So, stick around to learn more about the ins and outs of renters coverage below.

Interested in KOHO's tenant insurance policies? Contact us today for a quote!

What is tenant insurance coverage?

Tenant insurance coverage is a type of home insurance designed with the unique needs of renters in mind. In general, a basic tenant insurance policy will have the following types of insurance guarantees listed below:

Personal belongings coverage

The first portion of any renters insurance is personal belongings coverage, also known as contents insurance. Contents insurance provides renters with financial protection in the event their items are stolen or lost due to an insured loss.

For example, if someone breaks into your rental unit and causes damage to your furniture and other personal belongings, your contents coverage will kick into place and provide you with compensation to repair or replace your items.

Common risks included in a standard policy include fire damage, vandalism, and theft. Further, content insurance requires tenants to pay a deductible amount toward the total cost of their insurance claim before insurance companies will cover the rest. So, when choosing your coverage, ensure you're comfortable with the deductible amount you opt for.

Liability insurance

Personal liability coverage is the next portion of all tenant insurance policies. Let's say you have a couple of friends over to celebrate you moving into your new rental home. Near the end of the night, as all your guests leave, one of them falls down your front steps and breaks their legs and suffers a concussion by hitting their head on the pavement.

In this scenario, you could be held legally responsible for these injuries if the injured person files a lawsuit against you for damages.

Here's where personal liability coverage comes into play. Should a third-party claim for bodily harm or property damage be filed against you, the liability portion of your renters insurance will cover the cost of any repairs, replacements, medical bills, legal fees, settlement costs and other expenses associated with the liability claim.

Additional living expenses

The final portion of your tenant insurance policy is additional living expenses. Should your rental unit be damaged to the extent that it is no longer safe to live there, your additional living expenses coverage will pay for you to live in a hotel room, pay for meals, and other costs you incur during the time when you are unable to live in your rental home.

Optional renters insurance policies

Beyond standard tenant insurance, renters in Toronto also have the option of purchasing additional coverage that can bridge any gaps in protection that a standard policy may not cover. Here are some add-on policies you may want to consider for your rented property:

High-value personal belongings coverage

Imagine your expensive prized possessions being lost or damaged due to a loss. While the contents coverage in a standard insurance policy will cover your personal property, it will only do so up to a certain amount, meaning your high-ticket items may not be covered.

This is where a high-value personal property coverage may come in handy if you own expensive items like artwork, musical instruments, jewellery, luxury bags or clothing, and other high-value belongings for any repairs or replacements.

Identity theft protection

Now, let's say someone breaks into your rental apartment and steals your personal identification information like your driver's licence, passport, banking numbers, and other essential info with the intent of committing a criminal offence.

Identity theft insurance will cover expenses associated with recovering and replacing your stolen documents.

Overland water insurance coverage

Overland water coverage protects renters in the event their personal belongings and units are damaged due to overland water flooding. It's important to note that basic tenant insurance does not usually view water damage as an insured loss.

Therefore, if you live near a body of water where heavy rainfall and flooding are common throughout the year, this type of renter's insurance in Canada can come in handy and provide you with an additional layer of protection.

Sewer backup coverage

The final tenant insurance policy you may want to consider when looking for additional coverage is sewer backup coverage, especially if you live in an older apartment or basement suite. With sewer backup, your personal property will be protected in the event it is damaged due to sewage resulting from heavy rainfall, clogs, or other plumbing problems.

What does tenant insurance not cover?

While tenant insurance protects against numerous unexpected events, there are some instances where coverage is not provided, including the following:

Water damage

As we mentioned, water damage will not be covered by renters insurance if the damage occurs due to neglect. For example, if you accidentally leave your bathtub running and it floods your apartment, your policy will not compensate you for damages as this is seen as a preventable event.

Bed bugs

Bed bugs are another exclusion you can expect not to find in tenant insurance, or any other vermin infestation for that matter. The way insurance companies see it, any type of infestation that occurs in your apartment or rental home is due to a maintenance issue. Because of this, it is your landlord's responsibility to deal with this type of situation.

Intentional or criminal acts

Finally, any intentional or criminal acts committed in your rental apartment will not be covered. For example, if you intentionally cause bodily injury to another individual or property damage, your personal liability will not provide coverage. The same goes for any illegal activities conducted on the premises of your rental property that may cause injury or property damage.

Is having tenant insurance mandatory?

If you're contemplating getting insurance, you may be wondering, is home insurance a legal requirement in Canada? The short answer is no, tenant insurance is not mandatory in Toronto, or other provinces and territories in Canada.

But there's a bit of a catch. Technically, your landlord can require you to purchase tenant insurance by putting it as a requirement in your lease agreement. And many landlords ask renters for this. That said, if you sign your agreement, they can't ask you to purchase renters insurance after the fact.

At the end of the day, having an insurance policy in place is meant to protect your personal finances and interests in the event something unexpected happens. Therefore, while it may not be a legal requirement in Canada, it's still worth looking into.

Does landlord insurance cover renters?

A common misconception amongst renters is that landlord's insurance policies also provide coverage to tenants. Unfortunately, this is not the case.

Landlord insurance is meant to protect the physical structure of the rental home and any detached structures if insured damage occurs. It also protects their personal belongings in the unit, such as the appliances.

Landlord insurance also protects landlords from any personal liability tied to the property. For example, if someone injures themselves, your landlord can't be held legally responsible. So, unlike landlord's insurance, your tenant's insurance will cover your own personal items and personal liability interests.

Do each of my roommates need their own renters insurance?

If you live with roommates, having your own tenant insurance is recommended. Imagine you had a tenant insurance policy in place while the rest of your roommates didn't. In the event a covered loss occurs, your tenant insurance will cover your items under contents coverage, your personal liability interests, and any additional living costs that you incur.

This means that your roommates without tenant insurance will be responsible for paying any costs associated with repairing or replacing their items and be personally liable for injuries or property damage if a third-party claim is filed against them.

So, to ensure that each tenant living in your rental is sufficiently protected, it's highly recommended that you each seek your own tenant insurance policy moving forward.

How is tenant insurance Toronto calculated?

If you're trying to save on monthly expenses and finalize your plans for spending and saving, we understand that you may have some questions about how much tenant insurance in Toronto will cost and how premiums are calculated. During the quoting process, insurance providers will look at a couple of different factors to determine how much you'll pay:

Where you rental unit is located

A big aspect that will play into the cost of your tenant insurance is where your rental is located. Some neighbourhoods are associated with more risks, such as higher crime rates than others. Additionally, others could be more prone to flooding and unfavourable weather conditions. These are the types of things an insurance company is going to keep in mind when calculating your cost for tenant insurance.

Your credit score

Your credit score is another factor insurance providers will likely take a look at. That said, not all of them do a credit check, so keep this in mind when getting different quotes from providers.

Naturally, having a higher credit score will lead to a more affordable premium. So, if you want to build your credit with KOHO, consider getting a free credit score check before opening a virtual credit card to start building your credit today.

Whether you live with pets

Whether or not you have pets can also play a role in what you end up paying for tenant insurance. For example, having a high-risk breed could result in more expensive coverage to ensure that you're protected in the case where your dog bites someone on your property.

Your claims history

Next is your claims history. If you've previously purchased tenant insurance and filed a claim, this could affect your insurance premium. Similar to auto insurance, the more claims you file, the more of a risk an insurance company is going to view you, which can lead to more expensive coverage.

How much coverage you purchase

If you opt to purchase additional property insurance coverage beyond basic insurance or choose a higher policy limit, you'll need to pay more for the added protection.

Are there ways I can save on my renters insurance in Toronto?

If you're trying to save on monthly expenses as much as possible, we're here to tell you that, yes, there are ways that you can save on your tenant insurance, and it's easier than you think!

Bundle your home and auto insurance

One of the best ways to save on property insurance is to bundle your policies. For example, you can bundle your home and auto insurance or any other insurance coverage you may have. By doing so, companies typically offer a discount to those who remain loyal to their company.

Ask about discounts

Another great way to save on your condo tenant insurance is to ask about discounts. You'd be surprised at how many discounts are available to customers that they don't know about! Some typical discounts include being claims-free, installing safety features in your rental, multi-policy discounts, and more!

Simply ask your insurance agent or broker, and they'll be more than happy to provide you with more information about available savings and help you determine whether you qualify for any.

Shop around for different quotes

Our next tip is to shop around and get a tenant insurance quote from numerous providers. Not only can this help you find the best deal out there, but it also gives you the opportunity to compare coverage options, which will help you find insurance that fits your needs.

Keep in mind that the lowest tenant insurance quote may not always be the best one. The goal with any time of insurance is to find a balance between coverage and affordability that doesn't compromise your peace of mind.

Pay for your tenant insurance policy upfront

If you can afford to do so, paying for your tenant insurance upfront is another great way to save. This is because insurance companies typically include an administration fee for monthly payments, as it costs them money to process these payments each month. So, by paying upfront for your coverage, you can essentially remove these added costs entirely.

Increase your deductible

A deductible is the amount you agree to pay upfront when filing an insurance claim before your coverage kicks in and covers the rest. By opting for a higher deductible option, you're essentially taking on more responsibility financially for any claims, which reduces the amount your insurance provider has to pay. As a result, this can lower your tenant insurance premium slightly.

Keep in mind that you should only opt for deductible options you can afford in the event you need to file a claim.

Lower your coverage limits

Lastly, lowering your coverage limits can also reduce the total amount you spend on insurance. The more your policy covers, the more financial assistance you'll receive following an insured event. By reducing your coverage limits, you can save on your overall costs.

Keep in mind however, that while more coverage may not be necessary in your circumstances, ensuring that you have enough at the end of the day is important. Again, find a happy balance between costs and coverage.

Can my landlord evict me for not having renters insurance?

No, your landlord cannot legally evict you from your property if you have already signed a lease agreement, it does indicate that you are responsible for purchasing rental insurance. They can, however, do so if the requirement for tenant insurance is listed in your agreement at the time you originally signed.

Even so, your landlord can only require you to have liability insurance. It is entirely up to you whether you want to purchase content coverage for your personal belongings.

How do I file an insurance claim under my tenant insurance?

Knowing how to file a tenant insurance claim will help make the process go more smoothly from beginning to end, ensuring that you collect your reimbursement as soon as possible. Here is what you need to do if property insurance claims occur in your rental:

Document the situation at hand

Firstly, you need to document any damage that has happened to your rental and your belongings. We recommend that you take as many photos and videos as possible as it will give your insurance company a better idea about what happened and how to compensate your claim.

If a crime has occurred, you'll need to call the police to the scene. Make sure to grab a copy of the police report as well to submit to your adjuster.

Review your tenant insurance policies

Once you've documented the damage, the next thing you should do is take a look at your tenant insurance. This will give you the opportunity to see if your tenant insurance covers the damage your items have experienced, or any personal liability claims that may be filed against you.

Contact your insurance company

After confirming that your tenant insurance covers your claim, give your insurance company and a call. During this call, an insurance agent will ask a series of questions about the information and provide you with next steps that you will need to follow.

Get and adjuster assigned to your claim

Once your insurance claim has been opened, you'll receive a claim number and be partnered with an adjuster. Your adjuster will be with you for the rest of the journey by keeping you updated on information that they need and so forth.

Investigation will occur

Now that an adjuster has been assigned, they will conduct an independent investigation about what happened in your rental. Depending on the circumstances of the situation, it can be difficult to tell how long this process will take.

During this time, we recommend staying in touch with your adjuster as frequently as possible for updates, so you can get a better idea about where along in the claims process you are.

Reimbursement for your damaged or stolen items

Finally, once the investigation is complete and your adjuster decides that you are eligible for compensation, they will contact you and give you a number of what they believe your claim is worth. If you don't believe the number they are proposing to you is fair, you are able to negotiate with them until you come to an agreement.

Once an agreement is made, your insurance adjuster will get you to sign a final release document that confirms you are happy with the settlement. They will also inform you how you will receive your compensation. Most insurance companies offer direct deposit or will mail you a cheque. In some cases, if you have worked with a restoration company, your insurer may be able to compensate them directly.

Purchase affordable tenant insurance with KOHO

At KOHO, we understand how important it is to save up for the unexpected, especially as a renter. Luckily, with tenant insurance in Toronto, you can rest assured knowing your finances and interests are protected.

To kick start your savings, consider opening a high-interest saving account with overdraft protection coverage to ensure your monthly payments are made on time, even during those months when money may be tight.

For more information about your finances, such as the advantages of prepaid cards, take a look through our online information hub we've tailored to help Canadians just like you.