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Dear Clueless:
Yes, you most certainly do! Just ask the victims of a devastating fire that gutted a Calgary apartment building recently. Many of them did not have insurance, and cannot afford to replace what they lost.
Even if you don't think you have many belongings, you likely have a television, furniture, dishes, perhaps a stereo system and some CDs. What would it cost to replace these items? Could you afford to do so tomorrow if you lost them in a fire? And what about temporary accommodation until you could return to your apartment?
There are special insurance packages designed for tenants, and many reasons for purchasing them.
First of all, besides the personal property in your apartment, you may have property outside that needs to be insured as well, like patio furniture, or even the Christmas shopping that could be stolen from the back seat of your car. Your automobile insurance usually covers a stolen item that is part of your car, like the stereo system, but it doesn't cover anything that is not.
That's where your tenant's insurance would kick in. Or what if you go on a ski vacation and your skis are stolen? Again, your tenant's insurance would probably come to your rescue.
Even more importantly, you may be held responsible for the damage that you may cause to any part of the building or to others who live or visit there. For example, if you leave the water running in your bathtub and it leaks to the apartment below, you are liable for that damage. Or, even worse, you could start a fire in your unit that could destroy the entire apartment building.
Again, you would be held responsible. For that reason alone, you most certainly need personal liability coverage, which is provided with the tenant's package -- usually a limit of at least $500,000 or $1 million. Not only does third-party liability cover the damages you may cause to somebody else's unit; it also covers legal costs to defend the claim in a lawsuit. This kind of coverage is difficult to purchase as a stand-alone product, so it is best to buy it as part of a tenant's package. You might want to buy even more coverage than what is offered in the package, for example better coverage for jewellery, or if you have made significant improvements to your apartment, like adding broadloom or built-in cabinets.
Remember, the landlord is not responsible for loss or damage that occurs in your apartment, unless it can be proven that he or she was negligent. It's up to the renter to insure his or her own personal property. Many of the victims of the Calgary fire are discovering that the hard way.
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