If you’re a renter and you’re planning on being away from your apartment for a while — or leaving it entirely before your lease ends — you might consider subletting your space to another person to cover your rent and avoid breaking your lease. But what is subletting? And how does subletting your rental apartment or house affect your lease and your tenant insurance policy? It’s important to know the answers to these questions before handing over your keys.

What is subletting?

A sublet, also known as a sublease, is the legal contract in force when a tenant rents an apartment to another person (known as a subtenant). If you’re renting your space but decide to rent it out to someone else, you’re participating in subletting. There are many reasons you may consider subletting your apartment, but the two most common are:

  • You’re moving to a new area and still have several months left on your lease, and you want to avoid penalties of breaking your lease, such as damaging your credit score, having difficulty renting again in the future, or having to pay the remaining rent you owe
  • You’re moving to a new place or travelling for an extended period and want to return to your apartment when you’re finished; by subletting, you can keep your lease in your name, but you aren’t on the hook for paying your rent yourself while you’re away

A sublet is a legal contract that allows a tenant to rent an apartment to another person. Do you know how it could affect your tenant insurance policy? Find out now.

Will subletting my space affect my lease?

Subletting your space likely won’t affect your lease, but this depends on the terms in your agreement and your local laws — be sure to review your lease and your municipal and provincial laws to make sure you’re legally allowed to sublet your apartment. It’s also important to discuss subletting with your landlord. If you sublet your apartment without your landlord’s consent, they may have the right to pursue legal action, or even eviction, depending on which province you live in.

If everything checks out and you’re allowed to sublet your apartment, you’ll maintain all of the rights and responsibilities for the dwelling that are outlined in your lease. That means the landlord still holds you responsible for the rent — meaning your subtenant will pay rent directly to you, and you’ll pay rent to the landlord — and for any damage to the property (including damage caused by the subtenant).

Will subletting my space affect my tenant insurance policy?

Most tenant insurance policies provide a wide range of protection, including coverages for third-party liability, additional living expenses, replacement cost, and identity theft, in addition to protecting your personal belongings. However, tenant insurance only protects the renter who is named on the policy, not everyone living in the space. This means your tenant insurance policy only protects you while you’re living in the rented space, not your subtenant. Your subtenant will need to purchase their own insurance

While every insurance provider is different, most won’t cover you at all while you’re subletting your rental space, even if you have a policy in place. If you try to make a claim for damages that happen while you’re subletting your space, your insurer could deny your claim and cancel your policy. As with other major life changes, you should talk to your group’s licensed home insurance broker and let them know you’re planning to sublet your space so they can make sure you have the coverage you need before you hand over the keys.

While every insurance provider is different, most won’t cover you while you’re subletting your rental space. Reach out to your home insurance broker to make sure you have the coverage you need before you hand over the keys.

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