If you’re renting out a property in Canada – whether it’s a basement suite, a condo, or a standalone investment property – your regular home insurance policy likely won’t protect you. You need landlord insurance.
Landlord insurance covers damage to your rental property caused by fire, water, severe weather, theft, and vandalism. It also covers loss of rental income following an insurable loss and third-party liability claims.
Here’s what landlord insurance covers, what it doesn’t, and what to look for when you’re shopping for a policy.
Why Landlord Insurance Is Different From Home Insurance
Landlord insurance is a type of commercial insurance that protects property owners from financial losses at their rental properties, including building damage, lost rental income, and liability claims. It’s different from standard home insurance, which typically won’t cover you once you start collecting rent.
The biggest difference? Home insurance is designed for owner-occupied properties. The moment you start collecting rent, you’ve changed the risk profile of that property, and most home insurance policies won’t respond to claims that arise from rental activity.
Without landlord insurance, you’re personally on the hook for repair costs, lost rental income, and legal fees if a tenant or visitor is injured on your property. Those costs add up fast.
Tip: Landlord insurance is tax deductible. The Canada Revenue Agency (CRA) says landlords can deduct any reasonable expenses they incur to earn rental income, including advertising costs and insurance premiums.
Do I Need Landlord Insurance to Rent a Room?
Even if you reside at the property where you rent rooms to tenants, you still need a commercial landlord insurance policy.
Check with your insurance broker first. Failing to inform your broker or insurance provider of changes to your living arrangements could void your policy.
What if a tenant accidentally starts a fire that destroys the kitchen? How will you fund your legal defence after someone gets hurt on your property and sues you for injuries or damages? Don’t wait until something goes wrong to find out you weren’t covered.
What Does Landlord Insurance Actually Cover?
A standard landlord insurance policy is typically built on four core coverages:
- Commercial General Liability (CGL) Insurance: protects you against liability claims arising from third-party property damage or bodily injury lawsuits on your rental property. It can cover medical expenses, legal fees, and damages awarded by a court. CGL insurance can also protect landlords from libel, slander, and defamation claims.
- Commercial Property Insurance: Protects the building and its contents against fire, theft, vandalism, and water and wind damage.
- Business Interruption Insurance: Covers lost rental income and ongoing overhead costs if an insurable loss – like a fire – forces you to temporarily close the property for repairs. It’s often bundled with commercial property insurance.
- Equipment Breakdown Insurance: Pays to repair or replace equipment like HVAC systems and appliances that cease to work because of a mechanical or electrical malfunction.
Optional Add-On Coverages Worth Considering
Not every landlord needs all of these, but a few are worth serious consideration depending on your property type, location, and tenant situation. Rental income protection in particular can be a lifesaver if a tenant stops paying or your property becomes uninhabitable:
- Contingent Unit Coverage: covers lost rental income and additional expenses when a condo becomes uninhabitable due to a covered loss.
- Lost Rental Income or Rental Default Insurance: covers missed rent payments by the tenant.
- Flood and Sewer Backup Insurance: covers water damage from overland flooding or municipal sewer backups – two of the most common and costly claims for Canadian landlords.
- Contents Insurance: protects personal property inside the rental unit.
- Emergency Coverage: helps pay for unexpected repair costs.
- Additional Construction Expenses: pays for necessary construction or renovation expenses to bring a damaged property up to code.
- Cyber Liability Insurance: covers you if tenant data, payment records, or other digital information is compromised in a cyberattack or data breach.
- Loss Assessment Coverage: protects condo owners against losses exceeding policy limits or not covered by the policy.
What Is Not Covered by Landlord Insurance?
Landlord insurance covers a lot, but not everything. Here’s what falls outside a standard policy:
- Maintenance-related issues or household equipment breakdowns, or general wear and tear.
- Intentional damage caused by tenants.
- Indoor plumbing issues or freezing pipes.
- Pest damage and other natural events and disasters (earthquakes).
- Hail, sewer backup, and overland water flood damage.
- The legal costs of non-injury legal claims (for example, wrongful eviction or unsanitary housekeeping).
- Personal liability protection for tenants or their belongings (more on this below).
Additional riders may need to be purchased to ensure full coverage for specific situations.
Not sure if your property is fully covered? A Zensurance broker can walk you through any gaps.
Will Landlord Insurance Cover an Airbnb or VRBO Rental?
Listing your property with Airbnb or VRBO turns your private residence into a business property.
Some insurance providers will allow short-term rentals under your homeowner policy if you notify them beforehand. Others will only permit it if you’re renting out a room or unit in the home you currently reside in, or they might impose certain coverage restrictions. And some may not allow it at all and would not cover any damages or losses resulting from renting out your property.
If you’re offering short-term rentals of your home or seasonal property, look into insurance for Airbnb and VRBO rentals. A comprehensive insurance policy for short-term home-sharing rental properties includes general liability and commercial property coverage. In addition, it typically protects your rental income, a loss assessment, a contingent unit, and cyber liability insurance.
The safest move? Talk to a broker before you list. It takes five minutes and could save you from a denied claim.
Does Landlord Insurance Protect My Tenants?
Landlord insurance protects you and your rental property. Your tenants need their own renters or tenants insurance.
Encourage your renters to purchase tenant insurance to cover their clothing, furniture, and other items. Plus, their liability coverage will help pay for any damage they cause to your property. A landlord insurance policy covers your appliances, fixtures, and maintenance equipment but not your tenants’ belongings.
While tenant insurance isn’t mandatory in most provinces, many landlords now require it as a condition of the lease to protect themselves financially. Your rental agreement with tenants can have renters insurance as a stipulation (as well as layout rules and address sublet conditions).
Landlord-tenant laws vary by province – knowing your obligations under the Residential Tenancies Act (or equivalent in your province) is just as important as having the right insurance.
How Much Does Landlord Insurance Cost in Canada?
No two properties are the same, and neither are their premiums. Insurers look at a range of factors when pricing a policy:
- The location and value, age, and condition of the rental property
- Fire protection and flood zone grades in the neighbourhood
- The building’s or home’s occupancy
- The value of your contents inside the property
- The replacement cost of the building
- The state of the plumbing and electrical systems
- The types of insurance you choose and the coverage limits
- Previous insurance claim history
The fastest way to know what you’ll pay? Get a free quote online in under 5 minutes.
How to Get Landlord Insurance in Canada (The Fast Way)
You’ve done the hard work of becoming a landlord. Don’t leave your investment exposed.
Landlord insurance is a must-have to protect your property and its contents from unexpected costs.
Fill out our online application for a free landlord insurance quote in less than 5 minutes.
Let our team of knowledgeable, licensed brokers shop our network of 50+ insurers to find the right coverage to suit your needs and budget.
– Updated June 19, 2026.
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