Tenant insurance is a growth opportunity
Why insurance beats traditional warranties
Tenants may not realize they can get breakdown protection for all of their electronics – anything that plugs in and turns on – through their insurance policies.
Insurance gives consumers a solution that can be easier, more efficient and less expensive than extended warranty plans or traditional service contracts. But many consumers may not even realize that they have the option to buy this coverage through their insurance.
Devices are a fundamental part of life nowadays. For example: 73% of Canadians aged 18 and over have a smartphone, according to CTRC. 59% of adults have a game console. 74% of connected households have a computer.
These are devices that cost hundreds of dollars to replace or fix in the event of a breakdown – a big potential cost for anyone, whether they rent or own.
Covering those items through insurance offers a better, far more cost-effective option. Breakdown coverage can often be added for pennies a day.
Majority of tenants don’t have any insurance
Renters have a different mindset about insurance, at least in comparison to homeowners. While the vast majority of homeowners carry insurance on their homes, about half of tenants buy tenant insurance, according to IBC.
This is of course in significant part due to the fact that mortgaged properties almost always require insurance, while rentals don’t. But it also speaks to mindset: Tenants don’t have insurance at the top of their minds.
And even though Tenants don’t have a mortgage to protect, they do have lots of things they need to protect from breakdown.
Demographics mean more renters
Tenant insurance is poised to be a growing opportunity because renters make up a larger pool of potential personal lines customers. Two key demographic shifts are driving the proportion of Canadians who rent, rather than own their homes.
With baby boomers retiring, many of those plan to downsize by moving into smaller units, often rentals. Similarly, for a variety of reasons, millennials have been slow to buy homes, and many choose to remain renters.
The bottom line: There are a lot more tenants out there. By discussing how purchasing tenant insurance can be a valuable investment, new clients may be won.