Tenant’s insurance, also known as renter’s insurance, is a crucial safety net for anyone renting a property. While not a legal requirement, this type of insurance will offer you financial protection from the loss of personal property, as well as liability coverage.
Whether you need to get this insurance as part of your lease agreement or simply want peace of mind, you’ll no doubt be wondering about the tenant insurance cost in Ontario. Here, we’ll take a closer look at your expected costs along with some money-saving tips. Let’s get started!
Average Cost of Tenant’s Insurance in Ontario
Tenant insurance cost in Ontario can vary widely based on several factors. However, most people typically pay in the region of $15 to $40 per month. This translates to approximately $180 to $480 per year.
While that’s the expected range, the average cost is around $350 per year. Without looking at individual circumstances, it’s impossible to know exactly how much you’ll need to pay, and therefore, it’s useful to know what affects the tenant insurance cost. With that in mind, let’s take a closer look at those factors.
Factors Influencing Tenant’s Insurance Costs in Ontario
While there are many different factors that will affect the cost of your insurance, some are more important than others. Here are the ten most significant influences on your premium.
- Location – The location of your rental property in Ontario has the most significant impact on your insurance cost. If you live in an area of high crime or one that is prone to natural disasters, then you’ll likely be seen as a higher risk of property damage.
- Coverage Limits – There are different levels of coverage you can choose depending on the assets you need to protect. If you need a higher level of coverage, then you’re going to pay more for your premium.
- Deductible – The deductible is what you pay out of your own pocket before a claim can get started. The higher the deductible you have, the less you’ll need to pay, but this will mean you have more significant upfront costs.
- Type of Coverage – In terms of asset replacement, there are two ways it can be done. The first is the Actual Cash Value (ACV), which pays out what your asset is worth right now. Replacement Cost Value (RCV) pays what the new cost of the item would be.
For example, if you had a used game console, its actual value may be $250, whereas its replacement value is $500. As you can probably guess from this, policies that have RCV coverage will be more expensive as the value of the claim will be higher.
- Building Features – The features of your building will also have an influence on the cost. Examples of these features are security systems, fire alarms, sprinklers, and other safety measures. They can all affect the risk assessment of your property.
- Claims History – Have you made many claims in the past? If so, then you’ll be seen as a higher risk of making another claim in the future. This may not seem fair, but you’ll likely be charged higher premiums if you frequently claim on insurance.
- Discounts – Many insurance companies will offer discounts that can help to reduce the cost of your insurance. Examples include multi-policy discounts and loyalty discounts, which can affect how much you pay.
- Insurance Company – It would make sense that all insurance companies would have the same premium, but it doesn’t work like that. They all assess risk differently and will have differences between the payments they demand.
- Age and Personal Information – This can be a mystery at times, but your personal information can slightly affect what you pay. Age is a significant factor because, as with auto insurance, younger people are seen as a greater insurance risk.
- Payment Frequency – Our final factor that can affect your insurance cost is payment frequency. It’s common for insurers to offer a significant discount if you’re able to pay annually compared to monthly, as they’ll be getting all their money upfront.
How to Save on Tenant’s Insurance in Ontario
By looking at the factors that affect the cost, you probably already have a good idea of how to save money on your tenant’s insurance. However, let’s take a look at some money-saving tips in greater detail.
Shop Around – It’s important to compare quotes from multiple insurance companies. Better still, you can use an insurance broker who will do the hard work for you and find the most competitive rate.
Bundle Policies – When bundling policies together, insurance companies will generally give you a cheaper overall rate.
Increase Deductible – If you can afford it, should you need to make a claim, increasing your deductible can be a good way to get a cheaper premium.
Install Safety Features – It’s a great idea to install safety features at the property. Having a security system will reduce your premium, but having the likes of smoke detectors and fire extinguishers can also help.
Maintain a Good Claims History – It’s important only to make a claim when you absolutely need to. Avoiding small claims will help your risk profile and reduce your premiums.
Review and Adjust Coverage – Many people pay extra for coverage that they don’t need. It’s important to regularly review your coverage to ensure it meets your current needs.
Final Thoughts
Tenant’s insurance is important for renters in Toronto. It will give you valuable protection for your personal belongings as well as liability coverage. As we’ve seen, it’s not as expensive as many other forms of insurance, but it can be a vital financial safety net.
On average, tenants in Ontario can expect to pay between $15 and $40 per month for this coverage, but the exact cost will depend on a variety of factors. If you’re interested in tenant insurance, then get in touch with Buckler Insurance today and see how we can help.
