Reviewed by Daniel Mirkovic
Your home is probably your single greatest asset. Is this asset properly protected if a catastrophe, like a fire or an earthquake, occurs? When was the last time you reviewed your home insurance policy?
You should review your home insurance policy annually with your insurance provider. Your situation may have changed since you initially took out your policy, and an annual review will help make sure that you continue to carry the right coverage, at the right price.
The two most common types of home insurance policies are:
These policies specify the types of loss that you’re protected against, such as fire, lightning, explosion, smoke, falling objects, impact by aircraft or land vehicle, riot, vandalism, some types of water damage, windstorm, hail, and theft. You’re only protected if your property suffers loss or damage from one of the specified types of loss. These policies are generally the weakest form of insurance protection you can carry, despite very little premium savings. If your policy provides named perils coverage, then you should look around for a better option. It’s likely that you can obtain much better coverage without paying much more.
“All risk” or comprehensive policies protect you against all types of loss except those specifically excluded. Loss or damage due to wear and tear, snow slide, landslide, acts of terrorism, and war are some of the types of loss typically excluded. Even with the exclusions, comprehensive policies represent the best protection commonly available in Canada, usually at competitive premiums. You should always look for a comprehensive policy in order to receive the best value for your money should a loss occur.
Some important things to look for when reviewing your policy are:
Most insurance companies can add earthquake coverage to your policy for an extra charge.
Traditional insurance companies usually include some form of water damage protection. However, it can be quite limited, and often excludes water backup, which can sometimes be added for an extra charge. Square One automatically includes protection against most types of water damage in all of our policies.
Until a few years ago, most Canadian home insurance providers didn’t offer inland flood damage coverage. Insurance providers like Square One decided to change that; we’re proud to automatically include inland flood protection for 94% of our customers. Inland flood insurance covers losses caused by water that enters or damages your building over land, such as water from overflowing rivers and streams, or heavy rain; without this coverage on your policy, you will likely be on your own for losses of this nature. Ask your home insurance provider if your policy includes this coverage, and how to purchase inland flood coverage if it’s currently missing.
If you own a house, then this coverage guarantees that your policy will pay to rebuild your house, even if doing so costs more than the coverage limit. With market fluctuations, and catastrophic events such as wildfires and earthquakes, the cost to rebuild your house can increase dramatically from the amount you originally insured it for. At Square One, we include Guaranteed Building Replacement on all of our policies, except mobile home properties. This ensures that you don’t end up paying out of pocket if you unexpectedly can’t rebuild your home for the amount of coverage carried on your policy.
In the event of a loss that requires physical reconstruction, your house will suddenly become subject to today’s building codes and bylaws. The bylaws in your area may have changed since your house was built, or may require that you rebuild your entire house even if it’s only partially damaged. Either situation can result in significant additional costs, which you will be left to pay out of your own pocket if you don’t carry this coverage. Bylaw coverage is another optional add-on available from most home insurance providers; at Square One, we automatically cover the cost to upgrade your building after an insured loss so that it complies with current mandatory codes or bylaws – with no limit. This is a very important coverage that is often overlooked. Without it, you could be out thousands of dollars; at Square One, you don’t have to worry.
As a condo owner, you have additional unique insurance needs: improvements/upgrades to cover changes to the unit since it was originally constructed, condo/strata property deductible assessments to cover the costs if the strata charges you with a portion (or all) of their deductible, condo/strata property damage assessments and condo/strata liability damage assessments to cover you if you’re assessed for a portion of any loss the condo-strata suffers for which they don’t have adequate insurance. At Square One, we offer all of these coverages in customizable amounts to match your possible responsibilities as a condo owner.
Traditional insurance policies provide a specified amount of coverage for certain specialty items, whether you own any or not. These items include sporting equipment, bicycles, computers, cell phones, jewellery, silverware, and collectible items. At Square One, you can insure only the specialty items you want, for the amounts of coverage you want.
To make sure you have the coverage you need:
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