Tenants / Renters Insurance:
The landlord of your apartment has insurance for the building, but it will not cover damage to your property or your liability for accidents. If your possessions are stolen during a break-in or damaged by a fire or severe weather, a tenant’s policy will allow you to recover their value. If someone is injured during an accident in your home, a tenant policy will help to protect you in the event of a lawsuit. You will need to have an approximate value in mind of your total contents and provide that to your broker. There are usually minimum coverage amounts provided by each insurer to ensure adequate coverage is offered as it is common to undervalue contents.
There are two types of coverage policies: Comprehensive and Broad Form.
Comprehensive Tenant Policy:
This is the most inclusive tenant insurance coverage available, and is sometimes referred to an “All Risk Policy”. It covers contents for all risks except those that have been specifically excluded in the policy documents. An example of such exclusion would be a sewer backup – which is naturally excluded by the policy, but that an individual can purchase additional coverage for to ensure that exclusion has been removed, and coverage will be provided for this type of loss.
Named Perils / Broad Form Policy:
If you are looking to save money by carrying the financial risk of some losses yourself, you may wish to consider a named perils policy that covers only those perils that are specifically stated in the policy, such as those listed below. This makes the policy more affordable, but puts more risk on the tenant.
- Air and vehicle impact
- Electrical current
- Escape of fuel oil
- Falling object
- Riot or civil disturbance
- Water Damage
- Wind and Hail
*this may vary from policy-to-policy.
Not all companies have the same tenant insurance options. And many use brand names with variations of coverage. So check your policy carefully.