Landlord insurance covers the rental property, landlord-owned items, liability, and sometimes lost rental income. Tenant insurance covers personal belongings, personal liability, and temporary housing costs. Each policy protects different risks.
Renting involves two parties, often strangers, who share legal and financial risks. Damage, accidents, and liability issues can affect either side. In these agreements, insurance helps absorb the cost of specific losses. However, the bigger problem is that many policy owners mix up which plan protects them.
Whether you’re a landlord or a tenant, it’s important to know which coverages support your best interests. You’ll resolve disputes fast if you understand the policies that apply to you. Both parties will also be able to set clear expectations before signing a lease or renting out a property. Here’s everything you should know about the differences between tenant vs. landlord insurance.
What Is the Difference Between Landlord Insurance and Tenant Insurance?
Landlord insurance and tenant insurance are distinct policies designed for different individuals and specific risks. Firstly, landlord insurance protects the property owner. It’s a type of insurance that covers risks that a basic homeowners policy doesn’t, which include the following:
- damage from specific natural disasters
- accidental damage to the property
- loss of rental income
- liability insurance claims from tenants or their guests
On the other hand, tenant insurance protects renters' rights. Standard coverage includes damage to their personal belongings, as well as personal liability for accidental damage and unintentional injury. People don’t need their own tenant insurance policy to start renting. However, landlords can require tenants to carry insurance as part of the lease agreement.
|
Category |
Landlord Insurance |
Tenant Insurance |
|
Who It Protects |
Property owner |
Tenant |
|
What It Covers |
Building, landlord-owned fixtures, appliances, and liability |
Personal belongings, tenant liability, additional living expenses |
|
Liability Coverage |
Injuries or damage related to the rental property |
Injuries or damage caused by the tenant |
|
Income Protection |
Loss of rental income after covered damage |
Not included |
|
Contents Covered |
Only landlord-owned items |
Tenant-owned belongings |
|
Building Coverage |
Yes |
No |
|
Required By Law? |
No |
Not by law, but often required in leases |
|
Common Add-Ons |
Sewer backup, flooding, equipment breakdown |
High-value item coverage, identity theft, extra liability |
Source: Pexels
What Does Landlord Insurance Cover in Ontario?
Your exact coverage will depend on your insurance provider. However, as a landlord insurance policy owner, you can generally file a claim for these expenses:
- Repairs when a kitchen fire damages built-in cabinetry and flooring
- Restoration costs after a burst pipe ruined the drywall in the rental unit
- Repairs when wind or hail breaks windows or exterior siding
- Legal expenses if a tenant’s guest is injured on a loose handrail
- Compensation for when a covered incident forces you to halt rent collection
- Vandalism affecting doors, locks, or exterior glass
- Damage when landlord-owned appliances cause smoke or fire
What Does Tenant Insurance Cover in Ontario?
Tenant insurance covers the renter’s belongings, not the building. Policyowners can file a claim in response to sudden, unexpected losses in the following situations:
- Electronics or furniture get damaged during a kitchen grease fire
- Water from another unit soaks the tenant’s belongings
- A visitor trips on a rug and gets injured
- Temporary housing after a fire makes the unit unsafe
- Personal items are stolen during a break-in
- Accidental damage to the property
- Valuable items, like bikes or computers, lost to theft inside the unit
Source: Pexels
FAQs About Tenant vs Landlord Insurance
A standard landlord insurance policy primarily covers personal property damage. It provides financial protection against covered incidents that affect your rental property, as well as any landlord-owned personal belongings inside it. Some policies also cover lost rental income. However, you may need optional add-ons to cover specific events that leave the rental unit uninhabitable.
Ontario doesn’t legally require landlord insurance, but without it, you’re exposed to major financial losses and legal expenses. Should natural disasters or damaging incidents occur, you’ll end up having to pay out of pocket.
Landlords can require tenants to carry renters’ insurance as a condition of the lease, but a tenant is not legally obligated to get insurance. However, they’ll be found responsible for damage they cause or incur liability if a visitor is injured.
In Summary
- Landlord and tenant insurance are separate policies designed for different people and risks.
- Landlord insurance protects the building, landlord-owned items, liability exposure, and in many cases, lost rental income.
- Tenant insurance protects personal belongings, personal liability, and temporary housing costs after a covered loss.
- Landlords insure the structure and fixtures; tenants insure their own property inside the unit.
- Neither policy is legally required in Ontario, but landlords can make tenant insurance mandatory in the lease.
- Landlord insurance typically covers events such as fires, burst pipes, vandalism, or injuries to guests.
- Tenant insurance responds to losses involving personal items, accidental damage, theft, or injuries inside the unit.
- Understanding who covers what prevents disputes and ensures both parties are protected financially.
Safeguard Your Property Investment With KASE Insurance
Standard liability coverage and home insurance won’t protect your rental business. To get protection from the specific risks you face as a property owner, reach out to KASE Insurance.
We offer custom, commercial-grade landlord insurance for properties of all sizes in Ontario. Whether you’re leasing a short-term rental unit or managing a multi-unit building, we can tailor a policy to suit your investment portfolio.
Book a consultation with a specialist today. Tell us what you’re renting out, and we’ll provide a free quote and coverage breakdown.