Tenant's insurance for students

3 good reasons why students should have tenant’s insurance

As the end of summer looms, college and university students are turning their thoughts back to school. Many of them are living away from home in rented apartments or houses. With their minds on books, studies and student loans, few students are thinking about tenant insurance.

But, did you know that your possessions are not covered by your landlord’s insurance? And, if you cause damage to your building, or harm to others who live or visit the building, you are legally responsible?

Here are the three biggest reasons why you may want to protect yourself and your belongings with tenant’s insurance.

1. To cover the cost of replacing your stuff

You may think that as a student you don’t have a lot of stuff, but if you add up the cost of replacing your clothing, your textbooks, your smart phone, computer, pots and pans, and bike, you may be shocked at the total value of what you own.

If there is a fire, water damage or burglary in your place, your landlord’s insurance will not cover your belongings. The responsibility to replace everything is yours. If you lost it all, would you have the financial means to replace it?

2. To cover your living costs after a loss

If a fire or flood forces you to leave your rental home, you would need a temporary place to stay, and you would have to eat out for as long as it takes to return to your home. If you had a chance to remove items from your home, you may have to rent a moving van or a storage unit.

Tenant’s insurance covers extra necessary expenses that you have after a loss such as hotel bills, restaurant meals and moving costs.

3. To protect you if you get sued

No one wants to think about being sued or the cost of becoming embroiled in a lawsuit. But think about this:

• If your coffee maker starts a fire that damages the entire building, you could be held responsible for the cost of the damage.
• If a guest is injured after tripping on your doormat or slipping on a stray ice cube on your kitchen floor, you could be held financially responsible for pain, suffering and medical bills.

Tenant’s insurance provides liability coverage for the costs you would have to pay resulting from a lawsuit such as paying someone who wins a case against you. It also helps to pay the cost for a lawyer to defend you.

A standard tenant’s insurance policy covers up to $1 million. You can increase your liability limit to $2 million if desired.

Things to know about tenant’s insurance

• There are typically two types of coverage offered for tenant’s insurance: all risks and named perils. All risks covers of your contents (except some that are specifically excluded). A named perils policy covers only perils that are specifically listed such as a fire or flood.
• An insurer has the right to determine whether an article is repaired or replaced.
• You may be covered for actual cost value or the cost to replace an item or items.
• Some policies may cover items that are stolen while off your property, such as a bike that is stolen while outside your workplace. Check with your broker.
• If you make a claim, you may have to present receipts and photos to show proof of ownership. It’s a good idea to keep an updated inventory of your stuff as well as any receipts and photos.

Read your policy carefully to determine your exact coverage. Ask your insurance broker to be clear about what your policy covers.

How much does tenant’s insurance cost?

You will find the cost of tenant’s insurance to be very reasonable, but it also varies due to several factors:

• How much insurance you need to be confident that you’re adequately covered. The more you own, the more coverage you need.
• The insurance levels of coverage – If you want to be insured for more than the basic named perils coverage, your premiums will be higher.
• The location of your dwelling - Is it in a high-crime area or a quiet suburb?
• How your unit or apartment was constructed – Is it frame or non-combustible? Do you live in a vintage home or a newly-constructed condominium?
• Your claims history – If you have submitted several insurance claims in the past, your premiums may be higher.
• Your deductible amount – The higher your deductible, the lower your premium.

Talk to an insurance broker about tenant’s insurance for your own peace-of-mind, so you can relax and focus on your studies.