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Your Guide to Landlord Insurance Coverage

Wondering about landlord insurance? Learn about coverage, cost, and more in our article.

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by Team Onlia
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Whether you’re thinking about renting out your property for the first time or are a seasoned landlord, one thing’s for sure – you’ll need protection for your investment.

So, what is landlord insurance? It helps protect landlord from unforeseen expenses. You’d be responsible for everything your tenant doesn’t bring with them. If a large appliance malfunctions and causes damage to the property, (if it malfunction and causes a fire that causes damage, we will cover that , you have to fix it or replace it, plus cover the costs . If your tenant’s friend is injured on the property, you could be held liable. And the list goes on.

Landlord insurance is your safety net, and this guide will help you make sense of it.

Types of landlord insurance coverage

In Ontario, standard landlord insurance coverages include liability insurance, property damage insurance, loss of income insurance, as well as additional coverages that can save you money such as flooding coverage.

Liability insurance

Liability coverage is a sure way to ease your state of mind as a landlord for those “just in case” scenarios.

An uneven floor. A broken stair, a rotting support beam. If your tenant or a guest of your tenant injures themselves on something in your place, you could be held responsible if you’re found negligent. In this case, your landlord liability coverage activates to help pay your legal fees, court expenses or any medical bills you’re deemed responsible to pay.

Property damage insurance

Another staple for landlords, this coverage activates in the event of damages caused by natural disaster, fire, electric and gas malfunctions, vandalism,

Loss of net rental income insurance

If your rented property is unliveable for tenants due to insured losses or damages, a good insurer will recover your net rental income until the property is fixed.

Additional landlord insurance coverage

In addition to the  crucial  coverages mentioned above, flooding coverage is important – and can be purchased as an additional endorsement.

Flooding

Since you’re not in the home to monitor water usage, this coverage protects you from what your tenants may be doing. It’s especially important if you’re renting out multiple family units that each use a lot of water.

Remember that renters' insurance covers what’s theirs, not what’s yours. It provides financial protection and compensation for tenants when their personal property is damaged or stolen. It has nothing to do with the property.  

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Landlord insurance costs

The cost of coverage

As with all insurance policies, landlord insurance costs will vary. In Ontario, the average residential landlord insurance costs around $900 per year for houses.

For a condo or apartment, the average is $400 a year. Again, location plays a part in pricing. In the GTA, the average ranges from $500 to $800 per year. The price is lower for condo landlords because the building itself is going to be insured by the condo corp.

It's important to note that landlord insurance has income protection onlia rates based on how much protection you have

Prices will fluctuate depending on location, and other variabilities like the age of the structure, safety features, and more.

What affects the price of landlord insurance?

Crime rates and natural disaster risks

If your property is in an above average crime rate area, your landlord insurance premium is going to be higher. This also extends to areas where natural disasters are common. Insurers base these rates off of historical data and area observation.

The property’s age

This factor comes into play for all types of property coverage. The older a property is, the more likely it’s going to be affected by building collapse, weaker framework, old pipes, and other liabilities. Because of these factors, premiums tend to be higher.

The property’s safety features

Your landlord insurance premiums can decrease as you make your property safer by installing burglar alarm systems, smoke alarms, fire sprinklers, and other safety devices for your tenants.

Key takeaways

  • Homeowners Insurance vs. Landlord Insurance vs. Tenant Insurance are all different types of coverages, and it’s important to make sure you have the correct type
  • All good Landlord Insurance Policies will cover liability insurance, property damage insurance, and loss of income insurance, but it’s ideal to see what other additional coverages you may want to add to your policy
  • The cost of your coverage can vary depending on multiple factors such as crime, environment, age, type of dwelling, and safety features

Becoming a landlord is a fantastic way to utilize your property, and supplement your income – and landlord insurance is the best way to make sure that money stays in your pocket.

Get landlord insurance

If you’re planning to rent a property, you should have landlord insurance so you’re covered for the inevitable surprises that come with being a landlord.

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