Your home, whether it’s a Single family residence, Duplex or Condominium is most likely the most expensive property you may ever own. That’s why the Insurance protecting it should be reviewed with a clear understanding of what you have purchased.
Not all polices are created the same and can range in price, and not all companies are the same either. Their coverage can change between demographic areas, home values, types of protection and even age groups.
At Homestead we work hard to tailor the policy to the client’s needs and their individual circumstances.
What value do I need for the insurance on my home?
The insurance value needs to reflect the current cost to rebuild the home of like, kind and quality basis. But also needs to consider current Municipal building bylaws. An example of that could be as simple as, windows must have double pane windows and exteriors walls must be 2X6 construction.
How much is the Earthquake Deductible and how does it apply?
The Earthquake Deductible is a percentage of the insured value. The typical amount is 8%-10% depending on the company.
I run a business from my home, how is this covered?
Home based businesses are not covered automatically, but depending on the type of operation, most companies can add on a Home Based business endorsement. These are limited to operations such as Desk Top Publishing, Accountants/Bookkeepers, Consultants, Hairdressers, Tailors, and other business that are office based.
Operations such as actual manufacturing, fabrication or repairs, will have to have a separate Commercial Insurance Policy. Even with a commercial policy for the business, the fact that a business is being run from the home will need to be disclosed to the insurance company that is covering the home.
Did you know a garage sale can be considered a business and could be a cause to deny a claim? i.e. a buyer comes on the property and trips and falls - liability could be declined.
What’s not covered?
Common exclusions are, Wear and Tear, Leakage & Seepage, Mold and or Mildew, Sewer Backup (added by endorsement), Earthquake (added by endorsement), Landslide, Snow slide, and Flood (limited availability).
A broken pipe that floods your basement is not considered a flood. Insurance classifies that as water escape. A Flood is water that enters your property over land from a lake, stream or other body of water (Fresh or Salt).
Regarding Flood Coverage, it has been an excluded peril for many years, and it is now being offered by a few Insurance carriers.At this time we have found the coverage is expensive, and it does carry a high deductible.
Sewer Backup is water that enters your home via an interior drain, toilet, sink or tub/shower stall. The source of water must be from within the home. If the water comes from an exterior drain and enters the home through a door or other entrance this would be excluded.
All policies have limitations and are usually targeted items when it come to theft. i.e Money, jewelry, bicycles, stamp & coin collections and items.
A common myth is insurance excludes ‘Acts of God’. This is not true as what’s not an act of god? Windstorms are covered; Falling trees are covered; Your brother In-law spills red wine on your white wall to wall carpet could be covered; Hitting him in the head with a frying pan, would not be covered.
High Value Homes/Replacement Values
Your insurer will likely want to conduct a valuation of your home in order to set the right replacement value and coverage level. Unlike an appraisal, this does not determine the market value of the property but rather the likely cost to rebuild the dwelling and other structures in the event of a complete loss, to original standards.
Liability–in the home and away from the home
Liability insurance is part of your homeowner policy. It protects against third party claims for bodily injury and property damage caused (Unintentionally) by you even when you are away from home.
Examples at home:
- Lawnmower picks up a rock and hits your neighbour’s window
- Your dog bites someone
- Limbing a tree and a branch lands on your neighbour’s car
Examples away from home:
- Your arrant golf ball hits a follow golfer or their property
- Run someone down while skiing
- Cause damage to someone’s home (accidentally)
These acts do not automatically make you responsible. Personal Liability will also cover the ‘Cost to Defend’ as well as any punitive or compensatory judgements.