A basic tenant insurance policy will include liability coverage. This helps tenants with situations where they may be at fault for damage to a third party, another suite, or the building. For example, if a fire starts in the tenant’s apartment and it damages another suite, liability insurance will help cover the costs of the damage to the tenant’s unit and the other suite.
Tenant insurance can also include contents insurance. This helps cover the replacement cost of the tenant’s goods and personal items destroyed by fire or water damage. The landlord’s insurance does not cover a tenant’s items. So tenants without insurance will not receive any compensation for destroyed items.
If the landlord requires the tenant to have insurance, they can require the tenant to provide proof of that insurance. The landlord may require this proof only once, or on an annual basis.
Many tenants have insurance even when it is not required under the lease in case of an emergency.