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If you own a rental property in Newfoundland and Labrador or Nova Scotia, landlord insurance is one of the most important protections you can have.

Here, we will answer the most common questions landlords have about rental property insurance, from the basics of how it works to the specific types of coverage that matter most.

What Is Landlord Insurance?

Landlord insurance, sometimes called rental property insurance, is insurance designed for a home or property rented to tenants rather than occupied by the owner. It can protect the building, your liability as a landlord, property you own at the rental and your rental income following certain insured losses.

Depending on the policy and coverage you choose, landlord insurance may help protect:

• The rental property itself
• Property you own at the rental, such as appliances or furnishings
• Your liability as a landlord if something goes wrong
• Rental income if an insured loss makes the property temporarily unfit to live in
• Other structures on the property, such as a detached garage or shed

Exactly what is covered depends on the policy, the insurer and the property. That is why it is important to understand not just whether you have landlord insurance, but what your particular policy actually covers.

Why Isn’t Regular Home Insurance Enough for a Rental Property?

Home insurance is designed around a home you own and live in. When you rent a property to someone else, the way it is used changes — and so do the risks an insurer needs to consider. Different liability considerations come into play, rental income is at stake, and the property is assessed differently.

Do not assume the insurance you had when you lived in the home will continue to work once tenants are living there. This applies if you:

• Move out and decide to rent rather than sell
• Purchase a property specifically as an investment
• Add a basement apartment or secondary suite
• Move into one unit of a multi-unit property and rent the others
• Change how or to whom the property is rented

If any of these apply, speak with your insurance broker before the property is occupied by tenants.

Who Needs Landlord Insurance?

Any property owner who rents their home, condo, duplex or investment property to tenants should have landlord insurance.

You should speak with a broker about landlord insurance if you:

• Own a house you rent to tenants
• Own a condo rented to someone else
• Own a duplex, triplex or other multi-unit rental property
• Have converted a former home into a rental
• Own more than one rental property
• Have added a rental unit or apartment to your property
• Are buying your first investment property

Different properties and rental arrangements can require different insurance solutions. A landlord with one single-family rental may have different needs from someone who owns several properties or a multi-unit building.

What Does Landlord Insurance Actually Cover?

The following are the key areas of coverage landlords should understand. Policies differ by insurer, property and coverage selected — always confirm the specifics with your broker.

Does It Cover the Rental Building?

Yes. Protecting the building is one of the primary purposes of landlord insurance.

If your rental property is damaged by an insured loss, your policy may help pay to repair or rebuild it, subject to your policy terms, limits and deductible. Covered losses can include fire, smoke, wind, hail, lightning, certain types of water damage, theft and vandalism.

The specific causes of loss covered depend on the policy you purchase. Never assume that because one type of damage is covered under one landlord policy, it will be covered under another.

Does It Cover Appliances, Furniture and Other Property You Own?

It can. Many landlords provide property for tenants to use — a refrigerator, stove, washer and dryer, window coverings or furniture in a furnished unit. Depending on your policy, landlord-owned property at the rental may be insured if damaged by a covered loss.

Tell your broker what you keep at the rental so the coverage can reflect it.

Does It Include Liability Coverage?

Yes. As a property owner, you could face a liability claim if a tenant or visitor is injured at the property and alleges you were responsible.

Common situations include:

• Slippery walkways or steps
• Loose railings or unsafe stairs
• Poorly maintained decks
• Falling ice or snow
• Other hazards associated with the property

Landlord liability coverage may help with legal costs and damages if you are held legally responsible, subject to the terms and limits of your policy.

Does It Cover Lost Rental Income?

If an insured loss, such as a fire, forces your tenants to move out while repairs are completed, you may stop collecting rent while your mortgage, taxes and other expenses continue. Rental income coverage can help replace that lost income for the period the property is uninhabitable following an insured loss.

This is distinct from a tenant who simply stops paying rent. Landlord insurance does not act as a guarantee against unpaid rent.

Does It Cover a Garage, Shed or Other Structures?

Coverage for detached garages, storage sheds and other outbuildings may be included or available depending on the policy. Make sure your broker knows about all structures on the property, not just the main building.

Does It Cover Damage Caused by Tenants?

Damage resulting from a covered insured event may be covered even if a tenant was occupying the property. Other tenant damage, normal wear and tear, or intentional damage may not be. Because coverage varies by policy and insurer, landlords should understand how their specific insurance responds rather than assuming all tenant damage is automatically covered.

Does It Cover Your Tenant’s Belongings?

No. Landlord insurance is designed to protect your interests as the property owner. It does not generally cover your tenant’s furniture, clothing, electronics, computers, jewellery or other personal belongings.

Tenants should carry their own tenant insurance, which covers their belongings and provides their own personal liability protection. Many landlords require tenant insurance as a condition of the lease.

What Doesn’t Landlord Insurance Usually Cover?

Understanding exclusions is just as important as knowing what is covered. Common exclusions include:

• Normal wear and tear: worn flooring, aging shingles, chipped paint and aging appliances are maintenance issues, not insured losses
• Routine maintenance and repairs: insurance is not a substitute for keeping the property in good condition
• Unpaid rent: rental income coverage responds to an insured loss, not a tenant who stops paying
• Your tenant’s belongings: these are the tenant’s responsibility under their own policy
• Certain types of water damage: water damage coverage can be complex; some types may be covered while others require additional coverage or may be excluded entirely

Exact exclusions vary by policy. Ask your broker what your policy does not cover before you need to make a claim.

What If You Rent Out Part of Your Own Home?

This situation is different from renting a standalone property. If you live in the home and rent out a basement apartment, secondary suite or another unit, do not assume your existing home insurance automatically accounts for the rental exposure.

Tell your broker exactly how the property is being used. The insurer may need details about the number of units, the tenants and the layout of the property to determine the appropriate coverage.

How Much Does Landlord Insurance Cost?

There is no single price. The cost depends on factors including:

• Location of the property
• Type, size and age of the building
• Number of rental units
• Construction and heating system
• Roof, electrical and plumbing condition
• Updates and renovations
• Rental use and occupancy
• Claims history
• Coverage options and deductible

Two landlords with seemingly similar properties can pay different amounts. The best way to understand the cost for your rental is to get a quote based on your actual property and situation.

What If You Own More Than One Rental Property?

Insurance needs become more complex as a portfolio grows. If you own multiple properties, reviewing them together can help ensure your coverage is consistent and complete.

You may have different building types, ages, heating systems, coverage limits and renewal dates across your properties. A broker can help you assess the full picture as your portfolio changes.

Landlord Insurance in Newfoundland and Labrador and Nova Scotia

Rental properties across Atlantic Canada come in all shapes and sizes. The insurance solution should reflect the property you actually own and how you actually rent it.

At Munn Insurance, our local insurance experts work with landlords throughout Newfoundland and Labrador and Nova Scotia to understand their properties, explain the coverage available and help find insurance that fits their specific situation. As an independent broker, we can help you navigate the options and make sure your coverage reflects how your property is actually being used.

Get a landlord insurance quote today.

Visit: www.munninsurance.com/landlord-insurance-program

Call: 1-855-726-8627

Local expertise. More insurance options. Coverage built around your property.