Tenants insurance is a means to protect and provide coverage for the items in your home. If personal belongings are damaged, destroyed or stolen either in your apartment or while on the road or during travel, your tenants insurance policy may pay for the replacement of such items. Tenant insurance also provides “loss-of-use” which covers temporary living expenses in case your apartment is not in a habitable condition or undergoing repairs. Your policy may also pay for damages caused to the belongings of the third party under your roof. In other words, your policy could pay for the replacement cost of the books you borrowed from a friend that are soaked thanks to the basement flooding. When you buy tenant insurance, you are given the option of insuring the valuables at actual cost value or replacement cost.
Replacement cost pays the amount it would take to replace the stolen/damaged item in the current market condition. In event of a claim, know that you will be better off if you opted for replacement cost coverage. Naturally, this also means that the policy that pays replacement cost also charges higher premiums. In contrast, the actual cost value will offer the book value i.e. the current market value for the item after accounting for its depreciation.
For luxury items that have a gradual rate of depreciation, consider the replace cost valuation method in your tenant insurance policy.
It is recommended that holders of tenant insurance policy build a list of the items in their apartment and share a copy with the insurance broker/agent. In event of a claim, the insurance company will ask for a list of belongings along with proof of purchase. Proof of purchase can be submitted in the form of receipts, or credit/debit card statement.
Ask your broker to explain the specifics of your policy along with the exclusions that apply so you may take the necessary steps to add additional endorsements. For instance, damages caused by earthquakes or floods may not covered under your tenant insurance policy. Persons living under your roof that are not listed in your tenant insurance policy may not automatically be covered. Once you understand the details of your policy, hopefully nothing will come as a surprise.
Zensurance is Canada’s leading online commercial insurance broker. We offer a full range of insurance products to small businesses, with a particular focus on digitizing businesses and technology startups. We understand what it is to work with new technology, and know the most common risks of which you should be aware. Based on that (and a lot of analytics), we recommend the ideal insurance coverage for your business.