Over a third of renters lack tenant insurance: survey

Tenant insurance is an essential safeguard for renters in case of disaster. In addition to priceless peace of mind, it provides vital protection for your personal belongings, liability coverage for accidental damage, and support for additional living expenses if your home becomes uninhabitable.  

Yet despite these protections, many renters still go without it. A recent survey conducted by LowestRates.ca found that 35% of Ontario renters don’t have tenant insurance. 

So why do so many renters skip out on tenant insurance?  

Over one-third of renters do not have tenant insurance 

Our survey shows that a significant number of Ontario renters have chosen not to purchase tenant insurance—largely due to a lack of awareness about what it offers and why it’s important.  

 “Many believe their landlord’s insurance covers their belongings, think renter’s insurance is too expensive, or assume they don’t own enough to justify it,” says Ceri Morris, product and underwriting manager for Square One Insurance. 

She also adds that “others are simply unaware that the coverage exists or underestimate the risks of theft, fire, or liability. These misunderstandings lead renters to skip affordable protection that could save them thousands in an emergency.” 

Tenant insurance comprises three main types of coverages:  

• Contents insurance: It covers your personal items—like furniture, electronics, and clothes—if it’s damaged or stolen. So, if there’s a fire or a break-in, your policy can help to replace what you lost. 
• Liability coverage: If you accidentally cause damage— like if a fire starts in your unit and spreads to a neighbouring apartment—you won’t be stuck paying for repairs or legal fees out of pocket. 
• Additional living expenses: If a covered peril makes your place unlivable, tenant insurance can cover hotel stays and other essentials while your home is being fixed. 

While your landlord’s property insurance might cover the building itself—from structural damage to shared areas like hallways or roofs—it does not extend protection to your personal belongings or actions.  

For example, if there's a fire or flood, the landlord's policy will likely pay for repairing the walls, floors, or ceilings, but it won’t cover your furniture, electronics, or other personal possessions. 

Also, the landlord’s insurance doesn’t include liability protection for incidents caused by you. If an overflowing sink in your unit damages the apartment below, you’d be responsible for the repairs and any associated legal costs.  

This is where tenant insurance becomes essential. It not only replaces lost or damaged items but also includes liability coverage, preventing you from shouldering expensive, unexpected bills. 

Read more: Surprising things you can make a home insurance claim for 

One in five tenants purchased tenant insurance voluntarily 

While many renters are required to have tenant insurance as part of their lease agreements, our survey shows that not all need prompting to get covered. 

Tenant insurance is not provincially mandated, but many landlords require tenants to get their own policy as part of their lease negotiations. In our survey, just shy of half of respondents were required by their landlord to purchase tenant insurance. 

A main reason why tenant insurance is required by some landlords is because tenant insurance protects both landlords and tenants for liability claims—like if a guest trips and gets injured in their apartment.  

By having a separate tenant insurance policy, landlords and tenants can make sure there’s no confusion over who pays what when it comes to incidents that occur inside the rented unit.  

To simplify the process, some landlords recommend insurers or resources to help tenants find coverage quickly. 

“Landlords should provide tenants with clear explanations of what renters’ insurance covers—personal property, liability, and temporary housing—and how it benefits both parties,” she says. This kind of transparency not only clears up common misconceptions but also builds trust between landlords and tenants. 

Learn more: Are you being asked to pay for tenant insurance? Here’s what to do 

7% of renters have made a claim 

According to our survey, 7% of respondents have filed at least one claim for incidents like fire, water damage, or theft.  

Renters have reported everything from fires and leaks to theft and multiple claims. Without tenant insurance, these situations can lead to major out-of-pocket costs for repairs, replacements, or even legal fees. 

High-rise condo renters might not consider potential issues like water damage from a neighbor or liability if something in their unit causes damage to others. Likewise, house renters, particularly those in basement units, might face higher flood risks or exposure to theft depending on where they are based in Ontario.  

For example, in July of 2024, Toronto and parts of the GTA experienced torrential rain, with over 100 mm falling in some areas. The storm led to widespread flooding, including 700 reports of basement flooding in Toronto.  

Mississauga was also hit hard, especially near Little Etobicoke Creek, where homes and businesses were damaged, according to a statement by the Government of Ontario. Many residents found their insurance didn’t cover the losses, prompting the Ontario government to launch its Disaster Recovery Assistance program to help those affected. 

"More people are renting today, and even if you're renting a basement or a high-rise, you're not immune to climate risks like floods or fires,” says Steven Harris, director of underwriting and operations at LowestRates.ca.  

That’s where tenant insurance steps in, helping protect you from unexpected accidents and the financial fallout that can follow. 

Related: Can your home become uninsurable due to climate risk?   

Understanding replacement value 

One major reason some people don’t opt into tenant insurance? They simply don’t think they own very much.  

For example, everyday items—like cookware, winter clothing, and other essentials—may seem insignificant individually, but together they can represent a substantial financial loss. 

“They think, 'I have a 10-year-old couch, and it's worth $50,' (so having insurance won’t matter so much), but tenant insurance replaces old for new, giving you funds to buy a similar couch brand new,” says Harris. 

Unlike policies that pay out based on an item’s current value—after years of wear and tear—some policies cover the cost of replacing your belongings with brand-new items.  

Misunderstandings about coverage limits and the value of their possessions lead renters to choose the bare minimum amount of coverage when they do purchase tenant insurance.  

“There was often a big delta for those who would always buy the minimum contents,” Harris explains. For example, someone might select a contents policy for $30,000, only to find that the actual cost of replacing their belongings is much higher.  

“At the time of loss, there's a bit of shock there when a person finds out how expensive it can be to get your life back,” Harris says.  

Rebuilding your life after suffering a loss, such as from theft, fire, or water damage, can be overwhelming without insurance to back you up. 

"If you don't have that insurance in place and you incur that loss, it’s going to take a really long time financially to put that life back together versus insurance stepping in and being able to give you the funds to help you resume normal life in a reasonable time frame,” says Harris.  

Related: Who pays when it comes to damage from renters? 

Tenant insurance goes much further than simply protecting your possessions and maintaining peace of mind.  

Buying coverage early can help build a claims-free insurance history, which may lead to lower premiums down the road when transitioning to homeownership. 

Make sure to explore your options and compare quotes to protect your belongings without overspending.  

Read next: Factor in the cost of tenant insurance on your apartment hunt