Member Support Question – Mandatory tenant insurance
More and more landlords are considering implementing mandatory tenant insurance policies.
The Residential Tenancies Act is silent on the issue of tenant insurance. Some recent Landlord and Tenant Board (LTB) decisions support a landlord’s right to require tenant insurance in the lease and to enforce that lease requirement at the LTB.
To implement a mandatory tenant insurance policy, landlords need to be prepared to roll out the policy as new tenants move in. Current tenants should be encouraged to obtain tenant insurance, and educating tenants on the types of situations where tenant insurance would benefit them is a good idea. Tenants that receive rent-geared-to-income subsidies and Ontario Works or Ontario Disability Support Program benefits may be able to have the monthly cost of insurance paid for out of the unused shelter portion of their benefits.
It is helpful to have an insurance information package available for tenants which includes information about tenant insurance and how to obtain coverage.
To make insurance a lease requirement, landlords need to decide on the wording in the lease. One possibility is:
You agree that it is your responsibility to buy your own insurance to protect against loss of or damage to your personal property, or the cost of any claims against you for damage to your unit or injury to other people. You agree to provide us with proof of your insurance coverage each year.
We are not liable for any claim that you make that could have been covered by your own insurance.
Any policy must also:
- Be clear about how you will verify that a tenant has insurance. Most landlords require proof of insurance upon move in and annually thereafter.
- Be clear about what remedy you will seek should a tenant not comply with this part of the lease.
In order to successfully implement a tenant insurance policy, you will need to educate tenants about the benefits of insurance and make it easy for them to access information. We will be talking more about tenant insurance at the ONPHA Regional Meetings. An HSC insurance representative will be on site to answer questions about tenant insurance.