Author Topic: High deductible tenant's/home owners insurance in Canada  (Read 155 times)

Seadog

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High deductible tenant's/home owners insurance in Canada
« on: May 14, 2019, 05:23:48 AM »
I'm currently renting a place and am I guess self insuring since replacing $20k worth or my things would suck, but basically be no worse than a bad day on the markets stash wise.

What I hadn't thought about and parents recently pointed out was the liability factor, largely if I do something dumb and burn the place down.  It would take me from borderline FIRE, to needing to seriously find a job.

Since insurance is generally a losing bet, it's prudent to get as little of it as you can afford. So I was trying to find something with no belongings coverage, 10-25k deductible, and only for those holy shit occasions. Unfortunately I've checked a few places (online), and they all have no option to reduce belongings coverage below 25k, nor have a deductible higher than like $1k. Granted it's only like $300 a year, but since the vast majority of claims I'm sure are in the sub $10k range, correspondingly the vast majority of that risk premium is probably for those small claims, which I can handle on my own just fine. It's not a ton of money, but as they say FI is accomplished $10 at a time...

Anyone have this sort of holy shit insurance for their housing/tenancy? I had such a policy for health insurance when I took a year or so to travel, but they seem surprisingly sparse in the housing front.

ElleFiji

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Re: High deductible tenant's/home owners insurance in Canada
« Reply #1 on: May 14, 2019, 05:58:59 AM »
I don't think that a high deductible policy would beat the standard policies. I'd also check if having tenant insurance is a requirement of your lease.

As a tenant, my $200/ year is to make sure I'm not liable, not for the added benefit of getting my stuff replaced

Dogastrophe

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Re: High deductible tenant's/home owners insurance in Canada
« Reply #2 on: May 14, 2019, 06:52:08 AM »
I'm paying sub-$300 per year for condo insurance.  IIRC, contents are around $35 or 40K plus replacement value of unit; $2 million liability.  My deductible is ~$500.

Replacement of contents is the inexpensive part ... having someone get hurt / burn place down / forgetting to turn off the tub water when you run out to the store / etc is the expensive part.   

Seadog

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Re: High deductible tenant's/home owners insurance in Canada
« Reply #3 on: May 14, 2019, 03:28:25 PM »
I'm paying sub-$300 per year for condo insurance.  IIRC, contents are around $35 or 40K plus replacement value of unit; $2 million liability.  My deductible is ~$500.

Replacement of contents is the inexpensive part ... having someone get hurt / burn place down / forgetting to turn off the tub water when you run out to the store / etc is the expensive part.   

Do you think so? I would think the opposite since the huge things almost never come up. I know over my life probably 15-20 ppl who've had to make claims on home insurance, and it was always sub $10k stuff. Break ins, storms, vandals, all of that is pretty common compared to the number of homes that burn down in a given year. Quite honestly, I don't know even from casual acquaintances someone who had something so major happen that it would have required a 100k+ payout from insurance. 

The corollary to health insurance would be that the $2m cancer is the big thing, but you don't pay for that just because it's so rare. Changing my deductible from $1000 to $25k when I went on a big trip reduced my premiums by over 2/3rds. That would imply that 2/3rds of the cost-adjusted risk/claims are in the sub 25k range. It would be really neat actually to see a histogram of insurance payout frequency vs amount. 

Fiddling around with the TD calculator showed a 20% reduction going from a $300 deductible to a $1000, so that would similarly imply that ~20% of the monetary value of claims are in that range. While I am looking at only $300 or so, it's just the principle of it that pains me. Like being forced to gamble with money I can afford to lose, probably will, and if on the off chance I do win, won't gain any sort of material amount, but am forced to keep playing with my winnings at even worse odds since the casino knows I'm a winner and they need to make their money back.