In Canada about half of all renters have tenant insurance. So, there is a 50/50 chance that you don’t have any coverage. If you don’t have it, get it. Having it is not expensive. Not having any when you need it, is!!!

Some people seem to think their landlord’s insurance will cover them, if when something bad happens. Your landlord will have their own insurance to cover structural damage but that doesn’t cover your things. And content insurance (coverage for your things) is only one part of a tenant insurance policy. Tenant insurance covers:

• Contents: Things you own
• Liability: Things that happen to other people
• Living Expenses: Things you need while they fix your place

Content insurance

This is the type of coverage most people think of when they think of personal insurance, either as a home owner or as a renter or tenant. This is also the part of the policy whose value is most easily understood. You can think of the things in your home and come up with some idea of how much it all costs.

When you work out your policy you will need to figure out how much you think it would cost to start all over. You can make a couple of decisions about your coverage. You can decide whether you want to cover the added value of specific items, like your grandmother’s diamond engagement ring or the series of first edition Pokémon cards you have in the bottom drawer of your desk.

To be safe you probably should choose all risks. Otherwise, you can choose named perils, covering just those things you list in the policy. The last option could be to simply list items you want excluded.

Your final choice when choosing the details of your content insurance will be whether you choose cash value or replacement value. You are probably better off asking for replacement value. After all, you may have furniture left over from your college dorm room and its cash value is fairly low. But when you need a new couch for the living room, you will need to be able to pay the full price.

Liability insurance

Liability insurance covers things you might think of as being outside your control. If someone slips and falls on your sidewalk, liability insurance can cover damages assigned by the court and even pay to defend you in court.

And don’t think that if you live in an apartment tower that you don’t need liability coverage. You want to be covered if the fire marshal figures out that your toaster oven caused the fire or the unit below you is water damaged because of a broken dishwasher or leaky toilet.

Typical liability coverage is set at $1million. While this should be enough for most people, you may want to increase that limit to $2 million. The difference in cost will be negligible.

Additional Living Expenses

The third part of your tenant policy will be to cover additional living expenses while your home is being repaired. This can include the cost of a hotel, restaurant food and even moving expenses as you wait for things to return to normal. There are limits to these expenses. Check your policy to see what those limits might be – hopefully before you need to use it.