Landlord Insurance Ontario and Why You Need It

The idea of who a landlord is has changed dramatically over the last few years. What used to be that of a corporate entity has evolved to include your average, everyday homeowner who finished his/her basement to rent out or was approved for a second mortgage and bought a condo unit as an investment rental property and is renting it out in the meantime. The booming Ontario housing market, low interest rates and other factors have helped to expand our collective concept of who a landlord can be. 

If you’re one of those average Ontarians who is technically considered a landlord, it may be tempting for you to run your rental income business under-the-table or as a side job. The problem is, all it takes is one unfortunate accident or bad weather incident to get you in over your head. For example, not reporting to your municipal housing department that you’re renting out your basement or not reporting rental property income to CRA could both result in overwhelming fines.

The same thing goes for your property insurance. If you’re renting out a part of your home or own a separate rental property and something goes wrong, your home insurance company could very well deny your claim and cancel your policy – leaving you without any liability coverage when you need it most. The solution is simple, Landlord Insurance Ontario is both affordable and makes sure that you are fully protected. You can even get rent protection coverage in case you’re unable to collect rent in certain situations. More on that below.

The business insurance experts at ALIGNED have outlined the basics of what Landlord Insurance is all about in this post. 

Did You Know that Having a Friend Live with You Could Void Your Home Insurance Policy?

That’s because your insurance company needs to know who shares your residence and if someone not listed on your policy is responsible for a peril that would otherwise be covered, like a fire for example, they might not cover the property damage.

Other situations that require notifying insurance companies include renting out the basement or a room in your residence or taking in boarders on a home-sharing platform like Airbnb. If you are renting out a room or a basement in your primary residence for a rental property, you are considered a landlord and having Ontario Landlord Insurance coverage is the best way to ensure that your home and valuables are protected, that rental insurance claims will be covered and that you are protected from legal liability in case of personal injury or property damage.

Below are examples of other types of commercial tenancies that need Ontario Landlord Insurance.

Landlords Come in all Types of Tenancies

One of the features of Landlord Insurance in Ontario is its flexibility. A Landlord Insurance policy can be adapted to suit different types of tenancies and individual landlord needs. The following are rental situations where landlords can protect themselves and the substantial amounts of time, effort and, of course, money they’ve invested in their rental properties: 

  • Apartment buildings or complexes that house more than 7 families
  • Boarding houses or residential buildings that serve from one to six families
  • Owning one or more condo units for rental property
  • As mentioned above, renting out a portion of your primary residence e.g. a room or a basement.
  • Renting out a part of your house or an off-site property to students and other temporary or shorter-term leases. 

What’s Covered by Landlord Insurance in Ontario

Different insurance rental policy options can be included in Landlord Insurance coverage including:

  • Liability protection in case someone is injured on your rental property or someone else’s property is damaged because of something that happened on your property
  • Protection for the building(s) and contents on your property from events like fire, water damage, windstorms sewage backups, etc.
  • Coverage for theft, break-ins and vandalism
  • Contents coverage for appliances, furniture, electronics, valuables and other belongings
  • Renting insurance in case a peril makes your rental unit uninhabitable and therefore unrentable until it’s repaired
  • Coverage for rent owing if a tenant defaults on rent income

Why Landlord Insurance is a Better Option for Residential Tenancies in Ontario

It may be possible to get a rider or exception added to your rental property insurance policy that allows you rent out a part of your primary residence to commercial tenants – depending on how that property insurance policy is written and only for tenants at your primary residence. You would likely have to pay extra for that liability insurance because of the increased risk. And if something were to happen and you did need to make a claim, your home insurance premiums would likely increase with the possibility of your policy being cancelled outright. Also, a home insurance policy will not cover the loss of rental income.

Having dedicated Landlord Insurance rental property insurance coverage is the best way to make sure that your tenant-based claims will be covered, your primary residence is protected, your rental income is covered and that you don’t risk losing your home insurance coverage or having the premiums increase.

How much is Landlord Insurance in Ontario?

Generally, Landlord Insurance in Ontario is affordable and the coverage can be about the cost of a cup of coffee per day. The exact amount will depend on several factors including:

  • Where in Ontario your rental property is
  • The type of tenancy it is, i.e. an entire apartment complex vs a spare bedroom in your home
  • The value of the rental property
  • The types of liability coverage you need and want
  • Your past insurance policy claims history
  • The amount of rental income
  • Age of the building
  • Type of: wiring, heating, plumbing, roofing etc.

Contact us to get a quote on Landlord Insurance for your specific property rental unit.

Get Landlord Insurance from the Business Insurance Experts at ALIGNED

Just as you would take your car to an auto body shop for mechanical problems, it’s better to have business insurance specialists find you an Ontario Landlord Insurance plan because you are now running a business. ALIGNED has worked with all kinds of property landlords in Ontario for decades. Contact an ALIGNED advocate today and get a quote free with no-obligation.

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