What is Contents Insurance in Canada?

Content insurance protects your personal items. This could either be if the possessions are in your house or also while you travel. Whether you’re a tenant or homeowner, it can be incredibly beneficial to purchase contents cover as it’ll offer coverage for your furniture, electronics, and in some cases, jewelry.

The types of items covered really depend on what type of contents insurance you opt-in for. A lot of the time, it’s also included in any comprehensive tenant’s or home insurance policy. So before you jump into buying contents insurance, be aware that you may already be covered through the mentioned insurances.

To help you better understand contents insurance, I thought it would be best to describe some situations in which you can benefit from it.

For tenants, homeowners, or landlords that opt-in for contents insurance will have to tell the insurer how much you want to cover. You’d also need to make them aware of what you’re protecting and may have to supply some information about the products, such as barcodes, pictures, and other related identities a product may have.

For example, if you want to cover your TV, bed, kitchen appliance, etc. You may wish to choose a coverage that will at least compensate for $20,000. However, let’s say you have some high-end jewelry you want to keep protected and a painting. You may have to take out contents cover that is much higher than $20,000 and special policies to cover these types of goods.

The best way to prove the value of an item to an insurer is by providing them with a scanned copy of the receipt or any additional invoices that can verify an item’s cost. Also, be aware of any exclusions within your policy as you may need to purchase extra insurances to protect the type of goods or the way they’re damaged. For example, your contents may not be covered if they’re damaged in an earthquake, and therefore if you live in a high-risk area for this event, you’ll need to purchase additional coverage.

When purchasing tenants, landlords, or comprehensive condo insurance, you’ll be offered two different content coverage types. These are:

• Replacement cost coverage – For the item or items that have been damaged or stolen, you’re able to claim a reimbursement for the cost of replacing the item with either an exact match or something similar. For instance, if your cooker breaks which you’re not liable for, you can claim a new cooker that is either a similar price range or an exact match to the one you had before.
• Actual cash value coverage – This will compensate for the damaged or stolen goods instead of a replacement. You’ll be able to receive a pay-out for the amount of the item which was stolen. However, the only downside to this coverage is that it’ll only pay-out on current market value. So, if your item depreciates over time, you won’t compensation for what you originally bought it for.