Landlord insurance vs home insurance comes down to one question: who lives in the property? A homeowner policy is written for a home you live in. If you rent out the whole house or condo and live somewhere else, you usually need a separate landlord policy, also called a rental dwelling policy. If you rent a suite in the home you live in, your insurer may adjust your home policy instead, once you tell it.
Landlord insurance vs home insurance: which one do you need?
You need landlord insurance when you rent out a property you don't live in. A homeowner policy covers you, your spouse and your dependants in your own home. If you rent a suite in the home you live in, tell your insurer first, because it may cover the unit under your home policy. Either way, tenants need their own insurance.
The table compares three setups in general terms, as of October 2026. Your own policy wording decides what's covered.
| What's covered | Homeowner policy (you live there, no tenants) | Homeowner policy updated for a rental suite (you live in the rest) | Rental dwelling or landlord policy (you live elsewhere) |
|---|---|---|---|
| Building | Yes, the home you live in | Yes, including the suite, once you disclose it | Yes, on a named-perils or comprehensive form |
| Your own contents | Your household's belongings | Your household's belongings | Only what you own at the property, such as appliances, with its own limit |
| Tenant's belongings | Not covered | Not covered: the tenant needs tenant insurance | Not covered: the tenant needs tenant insurance |
| Rental income | Not designed for renting | Possible after an insured loss, depending on the policy | Included on some forms, optional on others |
| Liability | You, your spouse and your dependants | Yours as the owner, not the tenant's | Premises liability as the owner |
| Vacancy | Tell your insurer before the home sits unoccupied for more than 30 days | Same rule, since you still live there | Ask how empty periods between tenants are treated |
| Damage or theft by tenants | Not applicable | Ask: wording varies | Varies by insurer and policy form |
General description based on Insurance Bureau of Canada guidance and insurer product pages, October 2026. It is not a policy wording.
Why a homeowner policy stops fitting once you rent
A homeowner policy is built around the people who live in the home. The Insurance Bureau of Canada (IBC) says it covers property, contents and personal liability for you, your spouse and your dependants. It doesn't include your tenant's contents or your tenant's personal liability.
Renting changes the risk the insurer agreed to cover. Someone outside your family now lives there, and you earn income from it.
That's why disclosure matters so much. IBC warns that failing to provide full disclosure about who occupies the home may void your home insurance policy. Its example is a tenant who starts a fire in a basement the insurer didn't know was rented.
Whether a claim is reduced, refused or paid depends on your policy wording. Don't test it. Tell your insurance representative before your living arrangement changes, as IBC advises, and keep a written record.
Can you keep homeowners insurance on a rental property?
Usually not, if you no longer live there. TD Insurance says home insurance may cover renting out part of your own home. If you own a rental property you don't occupy, though, it says you'll need landlord insurance instead.
Renting a suite in the home you live in
A basement suite, in-law suite or garden suite is the most common in-between case. IBC notes these units also go by names such as granny flats and accessory dwelling units.
If you still live in the main home, you may not need a separate landlord policy. IBC says standard policies make provisions for boarders, roomers and tenants who live in secondary suites. Its guide to in-law suites adds these points:
- The unit itself. Your insurer may cover the suite as part of your home, once it knows about it.
- Lost rent. The insurer may cover rent you lose after an insured loss, if you have additional living expenses coverage.
- The tenant's things. Your policy excludes a renter's personal property, so your tenant needs tenant insurance.
- Family is different. Your coverage generally extends to direct family members living in the suite, such as a parent-in-law.
- The price. A suite can raise your property's value, which may raise your insurance rates.
Building a suite is a renovation too, so IBC advises telling your insurance representative before the work begins. A separate unit with its own entry must also meet local bylaws, which IBC says typically require smoke and carbon monoxide detectors.
Renting out the whole property
If you move out and rent the whole house, the homeowner policy no longer matches how the home is used. This is the classic "renting out my house" insurance question, and the usual answer is a rental dwelling policy.
The same applies if you keep your old house as a rental after buying a new one. You'll then need two policies: a landlord policy on the rental, and a home, condo or tenant policy where you now live.
Renting out a condo unit
Condo owners who rent out their unit face the same switch. Ask about a unit-owner policy written for a rented unit, and check how it treats your improvements and any deductible assessment. Our guide to the condo insurance deductible assessment explains that risk, and the condo insurance page covers unit coverage.
Short-term guests are a different case
Hosting short-term guests, such as through Airbnb, is a different arrangement from a long-term tenancy, so raise it with your insurer separately. See short-term rental insurance.
What a rental dwelling policy adds
A rental dwelling policy is home insurance rebuilt for a landlord. TD Insurance says a landlord policy generally protects four things:
- The building. Walls, floors, fixtures and heating and cooling systems, subject to the policy's perils and limits.
- Contents you own. Appliances you supply, and furniture if the unit is furnished.
- Your liability. Claims if you're legally responsible for injury or damage to someone else because you own the property.
- Lost rent. Rental income you lose when a covered loss forces tenants out.
Policies can come in more than one form. Intact, for example, describes a named-perils "fire and extended" rented dwelling form with optional add-ons, and a comprehensive form. On its fire and extended form, loss of rental income is optional; on its comprehensive form, it's included.
Check three details when you compare rental property insurance in Canada:
- Contents limit. Intact says its landlord contents limits are often around 10% of the reconstruction cost.
- Water. Intact notes floods and earthquakes need an add-on on its policies. Our guide on does home insurance cover water damage explains sewer backup and overland water.
- Tenant damage. Coverage for vandalism or theft by your own tenant varies. Intact says including vandalism by a tenant is part of what sets its rented dwelling policy apart, so don't assume every policy has it. Ask for that wording.
Intact notes that wear and tear, routine maintenance and pest infestations are generally excluded. Your tenants' belongings aren't covered either. Intact suggests requiring tenants to carry their own insurance; our guide on whether a landlord can require tenant insurance covers the Ontario lease.
If you own several rentals, a pool or other assets, look at your liability limit as a whole. Umbrella insurance can add a layer above your home and rental policies.
How to switch without a gap
The changeover is the risky moment. Take these steps in order:
- Call before anything changes. Tell your insurer in writing before the tenant moves in or before you move out, as IBC advises.
- Line up the dates. Start the rental dwelling policy on the day the use changes. Don't cancel the homeowner policy until the new one is in force.
- Plan for empty months. IBC says to contact your insurer if your home will be unoccupied for more than 30 days. If you don't, you may not have coverage. Ask how your policy treats a unit between tenants.
- Insure your new home. If you've moved, insure your belongings and liability at your new address.
- Require tenant insurance. Put it in the lease and ask for proof.
- Tell your lender. If the property has a mortgage, ask what proof of insurance your lender needs after the change.
Renting out a home in Ontario, Toronto or BC
Insurers and prices are local. In Ontario, insurers are regulated by the Financial Services Regulatory Authority of Ontario (FSRA). Compare home insurance in Ontario, or see home insurance in Toronto if your rental suite is in the city.
In British Columbia, the BC Financial Services Authority (BCFSA) regulates insurers. See home insurance in BC for local factors. In Quebec, the Autorité des marchés financiers (AMF) is the regulator, and Instasure offers information only there for now.
Michael's take
As a planner, I treat a rental property as a small business inside the household plan. The rent often helps carry a mortgage, so protecting that income matters as much as protecting the building. My rule of thumb is simple: the call to your insurer is step one of becoming a landlord, before you list the unit or sign a lease.
I'd also budget for the gaps no policy fills. Keep cash aside for the deductible and for a month or two without rent between tenants. Then look at liability across everything you own, not one policy at a time. Buy the coverage that protects your plan, and ask to see the wording on tenant damage and vacancy before you sign.
Next steps
Start with our landlord insurance page to request an advisor quote for a rental property. A licensed advisor in your province can compare rental dwelling policies and check the wording on rental income, vacancy and tenant damage.
If you live in the home and rent a suite, get an instant estimate with our home insurance calculator, then compare options on the home insurance page. Estimates are model-based ranges, not quotes. For house insurance prices by province, see the average home insurance cost in Canada.
