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Why You Need Renters Insurance - And What to Look for in a Policy

July 29, 19
4 mins
Couple in modern living room looking at laptop

Back in September 2018, dozens of tenants of a high rise in Toronto were displaced by fire. At the time, the CBC reported that 50% of renters in Canada don't have tenant insurance. That included several of those high rise residents, who struggled to find shelter after Red Cross assistance ran out. Helping to fill the gaps during such times of crisis is one of the benefits of renters insurance. Coverage may cost less than you think and provide essential peace of mind.

Renters' insurance: what it protects

Most people think of their stuff when it comes to insurance. That's certainly the case for a tenant policy, which gives you compensation for loss due to an insured risk. Usually that's things like fire or water damage. You can choose between a replacement value or cash value policy -- that's how much it costs to replace your items versus their market value when you lost them.

Tenants insurance also offers protection if you get sued. That may sound unlikely, but sometimes injuries or property damage happens where you live. If the injured person takes legal action, your insurance company can help defend you. According to the Insurance Bureau of Canada, most tenants' insurance policies have liability coverage of $1 million that you can increase to $2 million.

Additional living expenses are also included in most policies, subject to certain limits. If you can't live in your home for an insured reason, you can get meals, moving costs, and accommodation covered during the transition. That would generally apply in situations like that faced by the residents of the Toronto high rise.

There's another reason to buy renters insurance: building up a good history with an insurer. That way, when you do buy a home, you're more likely to get a good rate on home insurance.

Read the fine print

Renters insurance sounds like a good deal -- and it is, but it's always important to know your policy. Generally, this type of coverage is affordable. But your costs depend on several factors. Those might include your neighbourhood, the age or condition of your building, and the amount of belongings you own.

In addition, you can choose to increase your coverage by paying a higher premium. You may want to take this step if your deductible is higher than a potential payout. While it's true costs to replace your clothing, furniture and other items can quickly add up, a high deductible can mean you still have to pay a lot out of your own pocket.

There are a number of ways you can save on insurance, such as getting quotes from different companies and bundling together your renters and auto insurance.

Read your policy thoroughly, and if you are unclear about any details, ask your insurer for more information.

Check out the latest insurance quotes

Before you sign on for a new policy, check out all of your options for renters insurance at You can get the protection you need for yourself and your belongings in the event of the unexpected.


The RATESDOTCA editorial team are experienced writers focused on sharing stories and bringing you the latest news in insurance and personal finance. Our goal is to provide Canadians with the information and resources they need to make better insurance and financial decisions.

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