Accidents happen and while some can’t be prevented – that ink stain on your landlord’s carpet, for instance – you can buy insurance to protect you – and your deposit - against the event. As well as unintentional damage, tenants should consider contents insurance so their possessions are prepared for the unexpected. Here’s Canopy’s guide to tenant specific insurance products.

Understand the two insurance policies available to tenants

Generally tenants’ insurance policies fall into two camps. They can be offered individually or combined into one policy. Tenants’ contents insurance is the primary product and provides protection for personal possessions. Tenants’ liability insurance is something different. This will provide protection for any accidental damage to the rented property and any fixtures and fittings within, including those supplied by the landlord. 

Is tenant insurance a legal requirement?

There are no legal requirements, so it is up to the tenant whether they take out specific tenant insurance. The benefits, however, tend to outweigh the costs and an insurance product specifically designed for renters will take into account the unique situation of living in a property they don’t own.

For example, any damage caused by someone not acting in a ‘tenant-like manner’ needs to be paid for by the tenant. An example could be causing a house fire by overloading a power socket with plugs. Although classed as accidental and the damage not intentional, the fault would lie with the tenant and they would have to pay for repairs.

Accidental damage and deposit deductions also go hand in hand. The right tenants’ insurance policy would cover the cost of any repairs required, ensuring the damage is fixed and the deposit returned in full at the end of the tenancy.

Won’t my landlord have insurance?

You are right in thinking that landlords will have their own insurance policies but their cover may not extend to the tenant. The landlord will usually have buildings insurance and this covers the cost of repairing or rebuilding the property. In practical terms, this would pay out if there was a gas explosion and the property was destroyed.

If you are renting a part- or fully-furnished property, your landlord may also have a contents policy that covers damage and the replacement of any items they are supplying. In almost every case, it will not cover the personal items brought into the property by a tenant. 

What will a tenants’ contents insurance policy cover?

If you’re worried what might happen to your treasured and valuable possession within your rented property, a tenants’ contents policy is for you. Rather than protect the structure of the building (that’s the responsibility of the landlord), tenants’ contents insurance will protect the personal effects that you move in.

Valuables and possessions you can expect cover for include:

• Items of freestanding furniture
• Freestanding appliances and white goods
• Clothes
• Jewellery
• Tech and gadgets, such as televisions and tablets
  

When will a tenants’ contents policy pay out?

Although it’s always best to check the wording of each individual policy, tenants’ contents insurance tends to cover:-

• Theft: replacing your possessions if your home is broken into and valuables stolen
• Fire: paying out to replace items damaged in a house fire
• Water damage: covering the cost of replacing items that have suffered damage as a result of a flood, burst pipe or leak
• Storms: protecting items that may suffer damage during inclement weather
  

A tenants’ insurance policy may also provide the means to secure alternative accommodation should the tenanted property be uninhabitable after an incident or during repairs. This is not always offered as standard, so if you like the sound of this cover, ask if this is included before purchasing.

Accident prone? You may need extra

If you’re known for spilling red wine on the sofa, you should look into a tenants’ liability insurance product. This will provide accidental damage cover and extends to items that have been supplied in the property – a good aspect  if you unintentionally ruin something that doesn’t belongs to you. A basic level of accidental damage cover will protect gadgets and tech from unintentional damage but for a full ‘belt and braces’ approach, ask about full accidental damage cover. 

Full accidental damage cover would pay out if you dropped a saucepan and damaged the hob, or if you chipped a shower tray while cleaning it. Don’t forget, your inventory will show the condition of fixtures and fittings when you moved in, compared to when you check out. A landlord is within their rights to ask the tenant to pay for any repairs necessary. The correct insurance policy will cover this cost so the renter doesn’t have to find the money.

When a policy may not pay out

While a tenants’ insurance policy gives peace of mind, it’s worth knowing there are some caveats and grey areas. For instance, if your home is broken into but there’s no sign of forced entry, the policy may not be valid. And if the tenant leaves the property unoccupied for a lengthy period, the policy may not cover the contents during that time. 

Tenants should also be clear if the policy covers possessions away from the home or if it includes single, high-value items. It is usually possible to add these specific aspects to the policy but it may make the product more expensive to take out.

How to prepare when taking out tenants’ insurance

• Have the full address of the property you’ll be renting, including the postcode
• Make a list of all the high-value possessions you’re taking into a rented property, such as computers, jewellery and sports equipment
• It will be helpful to know the cost of purchase for each high-value item
• Work out how much you can afford to pay as an excess – a compulsory charge paid to the insurance company for every claim made
• If taking out tenants’ liability cover, include easily damaged items, such as carpets and soft furnishings
• Don’t forget to factor in the cost of supplying and fitting new items when estimating an item’s value 
• Find out from your landlord what security is in place at the property, including whether window and door locks conform to BSI standards