HOME INSURANCE OFFERS PEACE OF MIND
As we look around our neighbourhoods in the aftermath of the deadly storm that roared across southern Ontario and into Quebec on the Victoria Day long weekend, we’re reminded that Mother Nature is a powerful force.
The storm also reminded us about the importance of home insurance. Though it’s not mandatory by law, most banks or mortgage holders insist you purchase and show proof of home insurance before they’ll lend you the money to buy a house, which is often the single large financial investment most of us will ever make.
Having home insurance offers valuable peace of mind. Most basic policies cover damage to your property that’s the result of severe weather like wind, rain and hail. That includes the types of damage sustained during the May 21 storm: damage from felled trees, blown out windows and roof damage.
Here are some examples of what is and isn’t covered by most policies:
- If a tree falls on your property, you’re covered for any damage it causes to your insured items, which might include a detached garage and shed, but not the cost of having the tree itself removed.
- If a neighbour's tree falls on your property, any damage to your property is covered by your insurance, not theirs.
- If a fence you share with a neighbour is damaged, your policy will cover half and their policy will also cover half, which also means you each pay the deductible. Only the section of the fence that was damaged will be replaced.
- Your policy doesn’t cover alternate accommodation if your power is out, but most policies cover those costs if you’re prohibited from returning to your home or if it’s unlivable due to insured damage.
Sudden and accidental bursting of plumbing pipes and appliances is covered by all home insurance policies, but damage might not be covered when freezing causes the escape of water. If you purchased comprehensive or all perils coverage, damage to vehicles from wind, hail or water is typically covered. This coverage isn’t mandatory, so check your policy.
For many years, home insurance policies in Canada didn’t cover loss or damage caused by overland flooding, which occurs when bodies of fresh water, such as rivers or dams, overflow onto dry land. That’s no longer the case. Many insurers now offer overland flood coverage for most homes across the country. The coverage is optional and based on risk and is commonly combined with sewer backup coverage, which is also optional.
Making a claim
After a storm, assess your property. Check your roof for missing shingles, for example, to prevent future water damage. The Insurance Bureau of Canada (IBC; www.ibc.ca), the national industry association representing Canada's private home, auto and business insurers, offers these tips for starting the claims process:
- Call your insurance representative or company. Most insurers have a 24-hour claims service.
- List all damaged or destroyed items. If possible, assemble proofs of purchase, photos, receipts and warranties. Take photos of damage incurred and keep damaged items unless they pose a health hazard.
- Keep all receipts related to cleanup and living expenses if you’ve been displaced. Ask your insurance representative about what expenses you may be entitled to and for how long.
Once you’ve reported a loss, your insurance company will assign a claims adjustor to investigate the circumstances of the loss, examine the documents you provide and explain the process. Take notes and ask questions.
Before filing a claim, assess the damage and decide if it’s more than your deductible and more than future increases in your home insurance. The typical home insurance deductible is $1,000 and once you make a claim, your rates can increase 10 to 15 per cent each year for three years.
Flood, wildfire, heat, wind and hail events are growing in frequency and severity, according to the IBC, which offers A-Guide-to-Emergency-Preparation.pdf (ibc.ca). The following are among the tips the federal government offers in preparation for and during severe storms:
- Create an emergency plan and assemble an emergency kit. Guides are available at www.getprepared.gc.ca.
- If a severe storm is forecast, secure everything that could be blown around or torn loose. Flying objects, such as garbage cans and lawn furniture, can injure people and damage property.
- Trim dead branches and cut down dead trees to reduce the risk of them falling onto your house during a storm.
The King Team is experienced in everything you need to know and do to find the perfect home. We encourage you to take the necessary steps to protect your well-earned investment and safety. Please remember, emergencies can happen at any time and without warning. With a little preparation, you can respond quickly to help yourself and others.