November 13, 2015

Three reasons you need tenant insurance

If you’re renting an apartment, you may think of tenant insurance as an optional extra. Here’s why you can’t afford to do without it.

If you’re in your mid-20s to mid-30s, you’re probably pretty stretched, financially speaking. You may be paying back a student loan. You may have borrowed money to buy a car and are paying for car insurance, along with loan payments. If you’ve flown the family nest, you’ll be paying rent and you may have had to drop some serious coin at your local home furnishings store to get set up.

So if you’re a renter, coming up with the money for tenant insurance – something that isn’t mandatory and that you hope you’ll never need – may be a pretty low priority.

But here are three reasons why tenant insurance is something you can’t afford to do without.

1. Fire! Fire! Who pays?

Suppose there’s a fire in the apartment next to yours and, although the flames don’t reach your unit, the smoke and water wrecks everything in it – furniture, laptop, monitor, clothing, jewellery, shoes and your brand-new snowboard. Your landlord carries insurance on the building itself, but his policy doesn’t cover tenants’ belongings; it’s your responsibility to cover your own stuff, with tenant insurance.

And what if you have to stay in a hotel while your unit is being repaired? Tenant insurance helps cover the cost of another place to live if your living space is considered unfit to live in due to damage that’s covered under your policy, or if you’re not allowed in because of a police investigation.

2. It’s not always about you

Here’s another scenario. You travel a lot on business, and a pet sitter feeds and walks Violet, your Boston terrier, while you’re away. One night, the pet sitter comes in the front door, trips over a pile of shoes you left in the way after a frantic, last-minute search for your favourite high-tops, and breaks her leg. She can’t work for six weeks, and needs physio after the cast comes off. So, she sues you for lost wages and the bill for the physio. Fortunately for you, the liability section of your tenant insurance covers the cost.

3. You were robbed!

One last what-if: You go to a music festival for the weekend, and return to your ground-floor apartment to discover your back patio door has been smashed, and thieves have made off with your laptop, high-end bicycle, gaming system and big-screen TV. Your tenant insurance will help pay to replace everything that was taken, plus part of the cost of replacing the patio door.

Besides fire, liability and theft, some tenant insurance policies will cover your belongings if they are damaged during a move, and others may include (or offer as an option) coverage against identity theft. If someone has physically or digitally stolen your ID and is using it to do things like run up debts or acquire a passport, identity theft coverage can reimburse you for eligible identity restoration costs such as postage and long-distance calls. It can also help replace some of your lost income if you have to take time off work to complete fraud affidavits, meet with the police, lawyers or credit agencies, or go to court.

If you want more comprehensive coverage for your personal property and are prepared to pay more, all-risk insurance covers things like loss and accidental breakage – for example, if you lose your digital SLR camera at that music festival, or you trip over that same pile of shoes and drop and break your laptop.

Tenant insurance policies vary, and not everything mentioned here is included in all policies. Ask your carrier for details or check your policy document to find out what is and isn’t covered.

Sun Life Financial does not insure, administer or act as an agent in respect of the car and home insurance provided by Belair Insurance Company Inc., The Nordic Insurance Company of Canada and Trafalgar Insurance Company of Canada.

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