Got $2 million? Then get rid of that home insurance!

It’s easy to forego home insurance and civil liability coverage. You just have to meet one of these three criteria:

1 - For you, $2 million is small change

Best-in-class home insurance includes at least $2 million in civil liability coverage. It covers you if you’re responsible for a fire in a neighbouring house, if the mail carrier breaks their leg in your icy driveway, or if your washer leaks and wreaks havoc on the downstairs apartment, for example. If you’re able to absorb such costs, then you don’t need the insurance.

“Two out of every five renters don’t have home insurance. That’s risky. If they’re sued for damages, they’ll have to pay out of pocket.”

- Suzanne Michaud, CAA-Quebec Vice President, Insurance

For the rest of us, it’s better to take out insurance, which two out of five renters don’t do.¹ A third of them say they don’t own enough stuff to warrant insurance coverage. The rest think their landlord’s insurance will cover their belongings in the event of a disaster. But they could be sorely disappointed. Without home insurance, they don’t have civil liability coverage. If they set their building on fire while making French fries, they can be held liable for the damage.

2 - You’re covered by your parents’ insurance

Left home to go to school? Your parents’ home insurance should cover you, as long as you’re a full-time student and a dependent of your parents and they have added Students’ Personal Property coverage to their policy.

3 - You agree with all of the following statements:

·  I never mess up

Your dog will never bite? You never cook? The Gatineau fire department reports that one in five fires starts on the stove, as was the case for Chantal Fournier, who got the fright of her life. Quebec’s Fire Commissioner’s Office reports that 50% of fires are caused by human error and misuse.² If you don’t have insurance and you start a fire that spreads to other apartments, you may have to pay out of pocket.

·  I have a second apartment

If your building goes up in flames or major work is required before you can move back in, our home insurance could pay a benefit to cover temporary housing costs. It’s probably a more comfortable option than crashing on a friend or relative’s couch.

·  I don’t own anything valuable

People tend to underestimate the value of their belongings. But when you factor in your computer, cellphone, skis, and bicycle, it all adds up. You also have to look at replacement value, which could be higher than you think. When people get around to doing an inventory of their belongings, they often realize that coverage is worth it.

·  I don’t want to spend $22 per month

According to the Insurance Bureau of Canada, almost 70% of renters pay $22 or less per month to insure their belongings. The average value of a claim? $5,500.

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^{1 The Insurance Bureau of Canada says that 37% of renters aren’t insured.}

2 The Quebec City fire department’s 2016–2018 activity report. 47% when you add the following causes: human error (7%), misuse of equipment (3%), misuse of flammable materials (20%), and misuse of an ignition source (17%).