Rental Property Insurance – Detailed Information

Rented Dwellings / Landlord Insurance

Whether you are renting out a basement apartment, a house to students or own a multi-level high rise, being a landlord and property manager is a tough task. We have custom insurance policies specifically designed for property managers and landlords, providing you the peace of mind you deserve. All policies include coverage for the building, contents and liability.

As the building owner, you could be sued if someone is injured on the premises- even though your tenants are responsible for their own personal actions. In fact, even the tenants themselves could sue if they are injured due to a problem with building maintenance or repairs.

Did you know, that as a landlord, you can have your rental property insured under your homeowners insurance? Not all scenarios will qualify, but for the small-to-medium-sized home rental to one family or even up to a six-plex, this can be a very viable and affordable way for a landlord to insure their rental property or properties. Another important consideration: if a claim were to occur on your rental property that is on the same policy as your homeowners, this claim will be reflected on your homeowner’s policy and may affect your ability in obtaining homeowners insurance.

If you have a car insured with the same insurer, you probably qualify for a multiline discount which could save you 10-15 per cent on both policies.

Some insurance companies will offer coverage for your rental property under a Broad Form Coverage Policy or a basic Fire and Extended Coverage Policy. Other important coverages to consider with these policies would include Rental Income Replacement, and Sewer Backup.

Discuss your situation with your broker to determine if adding a rental dwelling to your homeowner policy or purchasing its own separate policy is best. Additional coverages can be reviewed to fit your needs.

Broad Coverage:

This policy provides comprehensive coverage (“All Risks”) on the building, and named perils coverage for contents. Contents are usually limited to smaller amounts than a homeowner policy as landlords typically only provide appliances in rental dwellings.

The named perils are generally:

  • Air and vehicle impact
  • Electrical current
  • Escape of fuel oil
  • Explosion
  • Falling object
  • Fire
  • Lightning
  • Riot or civil disturbance
  • Smoke
  • Theft
  • Transportation
  • Vandalism
  • Water Damage (limitations apply)
  • Wind and Hail

*this may vary from policy-to-policy

Remember, not all companies have the same home insurance options. Many use brand names with variations of coverage. Check your policy carefully.

Basic Coverage / Fire and Extended Coverage:

Some insurers offer a very basic coverage which is very limited in what they will be willing to cover.

Perils usually covered:

  • Fire or lightning
  • Windstorm or hail
  • Explosion
  • Riot or civil commotion
  • Aircraft
  • Vehicles
  • Falling objects
  • Smoke

*this may vary from policy-to-policy.

Not all companies have identical home insurance options. Brand name insurers may offer variations of coverage. Read your policy carefully.

Recommended Coverage Additions:

Fair Rental Value / Rent Income Coverage: If the building is damaged by fire or water, it may be uninhabitable while repairs are being made. The rent you would have been collecting during that time if the damage hadn’t occurred will be reimbursed with this coverage.

Sewer Backup: Coverage for water losses such as those caused by a backup of water into your home from a public water main or sewer system, faulty sump pump or septic tank can be purchased at an additional premium if the home qualifies. Not all homes will qualify for this coverage. A higher deductible may be required.