Tenant insurance
Nearly 25% of the province’s renters have no insurance. Some believe that the material items they own have little or no value, while others believe that home insurance is more for homeowners. Contrary to popular belief, home insurance is not strictly reserved for landlords. In fact, it’s an excellent way for tenants to protect themselves in a variety of situations.
What is a tenant insurance?
A common misconception of home insurance is that it protects against loss or damage to important building components, such as pipes or the physical structure. If you’re a tenant, your landlord probably already has his or her own insurance policy to cover this type of damage, but his or her insurance does not cover damage or loss to your personal property.
Is home insurance compulsory for tenants?
No, it’s not a legal obligation for tenants. However, it is essential if you want peace of mind, since no one is immune from damages. Many tenants overlook this type of coverage, believing that they have no valuables of their own. However, tenant’s home insurance can be very useful in a variety of situations.
Why take out such protection?
Of course, the primary function of tenant’s insurance is to cover loss or damage to personal property, but that’s not all! Tenant’s home insurance has a second essential function: third-party liability. So, having renters’ insurance also protects them from any damage they might unintentionally cause to others. For example, if their washing machine causes water damage in the apartment below theirs, the insurance will step in and cover the cost of repairs on their behalf. If such a situation occurs and they have no insurance, they will be held personally liable. Civil liability also applies outside the home, covering family members living under the same roof (spouse, children, etc.).
What about the landlord’s insurance?
As a homeowner, you probably have your own homeowner’s insurance policy to protect you against situations that could damage your main building. However, this policy does not duplicate your tenant’s policy. In fact, they are two completely separate insurance policies with different coverages, tailored to each tenant’s specific situation. Your tenants should never consider your landlord’s insurance to be sufficient to cover their property and liabilities.
Your tenant doesn’t want to take out an insurance policy: what can you do?
If a tenant doesn’t want to take out an insurance policy, it’s important to make them aware of the importance of such protection. To do this, it’s essential to explain to your uninsured tenants why it’s a bad idea not to have their own home insurance.
Start by explaining the difference between tenant’s insurance and landlord’s insurance. They need to be aware that your insurance doesn’t protect them. Use concrete, evocative examples to support your argument. You can use the examples mentioned above.
You can also tell them that renters’ insurance isn’t that expensive. Many renters have the misconception that renter’s insurance is very expensive. However, many insurance companies offer this type of coverage for as little as $15 to $20 a month. All you have to do is store around!
Is it possible to include a clause in the lease?
Yes, it’s entirely possible for you to add a clause to your lease stipulating that your tenant must have renter’s insurance. You can even add the requirement that they provide you with proof of such coverage. However, be careful: consult a legal advisor to ensure that this is done legally. In fact, you need to make sure that this is clearly written into the lease and accepted when you sign it. If you wish to add it during the course of the lease, the clause could be deemed abusive under the laws governing this area. On the other hand, if you wish to add it at lease renewal, you must respect certain conditions. Make sure you are properly informed before adding a clause.
