Absentee Landlord Insurance
Sutherland Insurance is a fifth-generation independent brokerage in Guelph, Ontario that places absentee landlord insurance across the province. An absentee landlord policy insures a rental property owned by someone who lives elsewhere, covering the building, loss of rental income and landlord liability. Sutherland Insurance has placed commercial business from Guelph, Ontario since 1870.
Key takeaways
- A rented property is insured on a landlord policy, not a homeowner policy, and an owner who does not live at or near the property is rated as an absentee landlord.
- Loss of rental income coverage pays the rent the property would have earned while it is uninhabitable after an insured loss.
- Ontario landlord policies carry vacancy and unoccupancy conditions that restrict coverage between tenancies after a stated number of days.
- A landlord's policy does not cover a tenant's belongings or a tenant's personal liability, which sit on the tenant's own policy.
- Who it is for
- Ontario rental property owners who live elsewhere in Canada or abroad
- Legally required in Ontario
- No, not required by provincial law
- Commonly required by
- Mortgage lenders, as a condition of financing
- What it insures
- The building, detached structures, landlord-owned contents, rental income and liability
- What it does not insure
- A tenant's belongings or a tenant's personal liability
- Tenancy governed by
- Ontario's Residential Tenancies Act, 2006
What is absentee landlord insurance?
Absentee landlord insurance is a rented-dwelling policy issued to an owner who does not live at or near the property. It covers the building, the detached structures, any contents the landlord supplies, the rental income lost after an insured loss, and the owner's liability to tenants and visitors. It is rated on the owner's distance from the property.
Distance is a rating factor because it changes how quickly a problem is found. An owner living in the building notices a slow leak, a failed sump pump or a heating outage within hours. An owner two provinces away learns about it when a tenant reports it, or when the damage is already extensive. Insurers price that difference and set conditions around inspection and property management.
What can an Ontario absentee landlord insurance policy cover?
What a policy can cover
- The rental building itself against insured perils including fire, wind, hail, lightning and sudden water escape
- Detached private structures on the property such as a garage, shed, fence or deck
- Landlord-owned contents supplied for the tenant's use, including appliances, window coverings and furnishings
- Loss of rental income while the property is uninhabitable following an insured loss, over a stated indemnity period
- Landlord liability for injury to a tenant, a guest or a member of the public arising from the property
- Optional endorsements including sewer backup, overland water, tenant vandalism and equipment breakdown
Commonly excluded under standard Ontario absentee landlord insurance wordings
- A tenant's belongings and a tenant's personal liability, which sit on the tenant's own policy
- Loss to a dwelling left vacant beyond the period stated in the wording, commonly thirty consecutive days
- Rent that goes unpaid where the property remains habitable, which is a commercial rather than an insured loss
- Damage from wear and tear, gradual deterioration, settling, or a lack of maintenance
- Overland water and sewer backup, unless the corresponding endorsement is added to the policy
- Illegal activity conducted at the property, including cannabis production beyond the personal limits allowed by law
Exclusions vary by insurer and by policy form; the issued policy governs.
How much does absentee landlord insurance cost in Ontario?
The factors that move an Ontario absentee landlord insurance premium, in approximate order of influence, and why insurers look at each one.
| Rating factor | Why |
|---|---|
| Distance between the owner and the property | Response time to a developing loss is the defining absentee exposure. |
| Whether a property manager is appointed | A local manager restores the inspection and response the owner cannot provide. |
| Reconstruction cost of the building | The building limit sets the insurer's exposure on a total loss. |
| Number of units in the building | Each tenancy adds a separate occupancy and liability exposure. |
| Tenant profile and turnover | Student, short-term and rooming occupancies carry different claim patterns. |
| Age of the roof, wiring, plumbing and heating | Older systems carry higher fire and water claim frequencies. |
| Rental income limit and indemnity period | A longer indemnity period covers more of a slow rebuild. |
| Claims history on the property | Loss history is a filed underwriting factor for every Ontario insurer. |
Is landlord insurance required in Ontario?
Landlord insurance is not required by Ontario law. A mortgage lender requires proof of property insurance as a condition of financing, which is contractual rather than statutory. Ontario's Residential Tenancies Act, 2006 governs the tenancy itself, and a landlord may include a requirement that the tenant carry insurance as a term of the lease.
Which policy is arranged, and with which limits and endorsements, depends on circumstances that vary from one property to the next:
- How far the owner lives from the property, and whether a local property manager is appointed.
- The number of units, and whether the occupancy is single-family, multi-unit or room-by-room.
- The rental income the property produces, and how long a rebuild would realistically take.
- Whether the lease requires the tenant to carry insurance, and whether certificates are collected.
- How long the property sits empty between tenancies, against the vacancy condition in the wording.
- Whether the property is at risk of sewer backup or overland water, and whether those endorsements are available.
What situations does absentee landlord insurance commonly address in Ontario?
Absentee landlord policies are arranged for a wide range of ownership circumstances across Ontario, and the coverage available differs in each. The situations below are common among Sutherland Insurance clients in Guelph and across the province, and each one changes which markets will write the risk.
- An owner living in another province whose Guelph rental property suffers a burst pipe in January.
- A landlord who has moved abroad and appointed a local property manager to handle inspections.
- An investor holding three tenanted properties in different Ontario municipalities on one programme.
- An owner whose unit sits empty for six weeks between tenancies, where the vacancy condition applies.
- A property whose tenant causes deliberate damage before vacating.
- A landlord whose building is uninhabitable after a fire and who still owes the mortgage while rent stops.
How Do I Get Business Insurance Through Sutherland Insurance?
Getting insurance through Sutherland Insurance is simple. You can request a quote online or call 519-822-0160 to speak with a licensed broker. We take the time to understand your business, identify your exposures, and find coverage options that fit your needs.
Our Process:
- Request a Quote. Complete an online quote request or call our office to speak with a licensed insurance broker.
- Tell Us About Your Business. Your broker will gather information about your operations, property, revenues, employees, vehicles, contracts, and any other areas that may require coverage.
- Review Your Risks and Coverage Needs. We assess your business exposures and insurance requirements to determine the appropriate coverage limits and options.
- Market Your Account. Sutherland Insurance compares the available commercial markets to help find the best combination of coverage, service, and price.
- Present Your Options. Your broker will review the available quotes and provide recommendations based on your specific needs and goals.
- Bind Coverage and Provide Documentation. Once you select coverage, we arrange the policy and provide any required documentation, including certificates of insurance for clients, landlords, lenders, or other third parties.
What makes Sutherland Insurance different from a direct insurer?
When a claim happens, Sutherland Insurance acts for the client with the insurer, and an in-house claims representative is available on any claim. Sutherland Insurance is an independent brokerage and compares the markets it holds contracts with rather than selling one company’s product. A person answers the phone at Sutherland Insurance, 519-822-0160, Monday to Friday, 8:30 a.m. to 5:00 p.m.
Frequently asked questions
Does home insurance cover a house I rent out in Ontario?
A standard Ontario homeowner policy covers an owner-occupied residence and does not respond once the property is tenanted. A rented dwelling is insured on a landlord policy, which adds loss of rental income and landlord liability and removes coverage for a tenant's belongings. Continuing a homeowner policy on a tenanted property risks a declined claim.
Does a landlord's insurance cover a tenant's belongings?
No. A landlord's policy covers the building, the landlord's own contents, the rental income and the landlord's liability. A tenant's furniture, electronics, clothing and personal liability are covered under a separate tenant policy issued to the tenant. The two policies operate independently, and each has its own limits and deductible.
What happens to landlord insurance between tenancies?
Ontario landlord policies carry vacancy and unoccupancy conditions that restrict or suspend certain coverage after a stated number of consecutive days, commonly thirty. Vacancy permits are available from some insurers where a unit is being turned over or renovated. Notifying the broker before the unit empties keeps the condition from being triggered.
Does landlord insurance cover tenant damage in Ontario?
Accidental damage caused by a tenant is commonly covered under an Ontario landlord policy as an insured peril. Deliberate damage and vandalism by a tenant are excluded on many wordings and available as an endorsement from some insurers. Unpaid rent and ordinary wear are not insured losses. The issued policy governs.
Does loss of rental income coverage pay if a tenant stops paying?
No. Loss of rental income responds when the property becomes uninhabitable after an insured loss, such as a fire, and rent stops as a result. It does not respond to a tenant who simply stops paying while the unit remains habitable, which is a tenancy matter under Ontario's Residential Tenancies Act, 2006.
How many markets does Sutherland Insurance place landlord business across?
Sutherland Insurance places commercial business, including rental property and absentee landlord risks, across the markets it holds contracts with together with multiple managing general agents and affiliates across Canada. It is an independent brokerage licensed by the Registered Insurance Brokers of Ontario.
Get your absentee landlord insurance quote
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Get your absentee landlord insurance quote Call 519-822-0160
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