Tenant home insurance: what's yours to insure

If you rent your home, chances are the property already has insurance: the landlord's. But that policy protects their property, not your belongings or any damage you might cause to other people. There are two things that are yours to insure: your belongings and your liability. In this article we explain where the line falls between one policy and the other, what gaps remain if you do nothing, and how to check what you're taking out.

Two policies for the same home

Two different interests coexist in a rented flat. The landlord has an interest in the property not losing value: walls, floors, embedded pipework, the electrical installation, joinery, fitted kitchens and bathrooms. In insurance terms, that's what's known as the building (the structure itself).

You have an interest in everything you've brought into the home, and in not having to pay out of your own pocket for damage you've caused. Your furniture, clothes, appliances and personal items make up the contents. And your obligation to make good any damage to others is your liability.

When the landlord takes out home insurance, it usually covers the building and, if the flat is let furnished, their own furniture and appliances too. What it almost never insures is what's yours.

What the landlord's insurance usually covers

Every policy is different, and the only way to know for certain is to read it. Even so, in a home policy taken out by the owner of a rented property, you'll often find:

• Damage to the building or the property from water, fire, explosion or weather events.
• Broken glass and electrical faults in the fixed installations.
• The landlord's own furniture and appliances, if they've declared them.
• The landlord's liability as the property owner: for example, if something comes loose from the façade of their building, or if a pipe in poor condition damages a neighbour.

Note that last point: the liability cover included in the landlord's policy is usually theirs, as the owner. If the damage is caused by your carelessness, that cover may not respond, or may respond and then claim the cost back from you. It depends on how it's worded, which is exactly why it's worth asking.

What's left out and is yours to cover

Your belongings

Picture a water leak in the kitchen that floods the living room. The landlord's insurance repairs the flooring and the pipe. Your sofa, your television, the clothes in the fitted wardrobe and the laptop that was on the floor are yours, and no policy of the landlord's is going to pay for them. If you don't have contents insurance, that loss falls on you.

The same applies to a burglary. If someone breaks into the property and takes your valuables, the owner's insurance might cover the forced door, but not your jewellery, your bicycle or your camera.

Damage you cause to others

You leave a tap running, the bath overflows, or the washing machine leaks through a badly fitted seal. The water goes down to the flat below and ruins ceilings, furniture and a painting belonging to the neighbour. That claim is directed at whoever caused the damage. Without liability cover of your own, you could end up paying for the repair and for the neighbour's belongings. We look at this in detail in our article on tenant liability and damage to a neighbour.

Damage you cause to the property itself

There's a situation many tenants overlook: accidental damage you cause to the rented property. For example, a hot pan slips and scorches the worktop, or a fire that starts in your kitchen damages the ceiling. As far as the landlord is concerned, you're a third party. Some tenant policies expressly include liability towards the landlord, and others don't. It's a point well worth checking.

Three cases to see where the line falls

Situation	What usually responds	What you should have in place
An old, embedded pipe bursts and soaks your furniture	The landlord's insurance, for the pipe and the wall	Your contents insurance, for your furniture
You leave the tap running and the water reaches the neighbour	Your liability cover, if you have it	Liability cover with a sufficient limit
A short circuit in your extension lead scorches the living-room wall	Depends on the cause and the policies involved	Liability towards the landlord

These are illustrative examples. In each real claim, insurers examine the cause and the terms of each policy before deciding who pays.

How to work out the value of your contents

One of the most common mistakes is insuring your contents by guesswork. If you declare a value that's too low to pay a lower premium, the insurer may apply the proportional rule when something happens and pay you only part of the claim. To avoid this:

1. Go through the home room by room and note down what's yours, not what came with the flat.
2. Think about how much it would cost to replace today, not what you paid years ago.
3. Separate out items of special value (jewellery, watches, camera equipment, instruments), as many policies set their own limit for these or require them to be declared separately.
4. Keep photos and receipts in the cloud. You'll need them if there's a burglary or a fire.
5. Review the value whenever you buy something significant or move to a new flat.

If you share a flat, make it clear who insures what. Insurers treat shared flats differently, and a policy in one person's name doesn't always cover the belongings of the others.

What to check before you take out cover

Tenant insurance is, in essence, a home policy focused on the contents and on liability. Before you sign, run through this checklist:

• Subject matter of the policy: that it insures the contents and not the building, so you're not paying for something the landlord already covers.
• Liability: what the limit is, whether it covers everyone living with you, and whether it includes damage to the rented property.
• Water damage: whether it covers your belongings, tracing the leak, and damage to third parties.
• Theft: whether it covers only inside the property or also outside it, and what security measures are required.
• Assistance: whether it includes emergency call-outs for locksmiths, plumbing or electrics, and who pays for the repair when the fault lies with the property.
• Legal expenses: whether the policy offers legal assistance and whether it includes or excludes disputes with the landlord.
• Excesses and exclusions: how much you're responsible for in each claim and which situations aren't covered.

What your tenancy agreement might require

It's increasingly common for tenancy agreements to include a clause requiring the tenant to hold liability insurance, or even full contents home insurance. Read it carefully: it may require a minimum limit, that the landlord be named in the policy in some way, or that you provide a copy of the receipt each year. If you're unsure about the legal scope of that clause, the sensible step is to consult a solicitor; we can help make sure the policy meets what the contract requires.

It's also worth asking the landlord what insurance they hold. This isn't about mistrust, but about knowing how cover is shared out if something happens. If the flat is in a building with several neighbours, there's also community insurance, which protects the shared areas and the main drainage.

Not the same as rent guarantee insurance

Sometimes the landlord mentions that they "already have rental insurance". They usually mean rent guarantee insurance, which protects them if you stop paying the rent. It's a useful product for the landlord, but it doesn't cover your belongings or your liability towards others. Nor does your tenant insurance replace it: they're policies with different purposes.

Common mistakes

• Assuming the landlord's insurance covers everything in the home.
• Taking out full home insurance including the building, paying for walls that aren't yours.
• Underestimating the value of the contents to save on the premium.
• Not checking whether the liability cover includes damage to the rented property itself.
• Not informing the insurer when you move, so the policy keeps pointing to the old address.

How we help at Retuerto y Asociados

We've been insurance brokers in Santa Cruz de Tenerife since 1992. We review your tenancy agreement, work out the value of your contents together with you, and compare several insurers so you can choose with the cover set out in writing. You can see what's worth checking on our tenant insurance page, or ask us for a no-obligation quote.