Most of the time we don’t want to think about our insurance.  It’s something on the back burner and for the most part we hope we never have to use it.  No one wants their home broken into, a flood in their basement, or to renovate their kitchen because of a fire, but it happens. People generally find out what’s REALLY covered by their plans when they make a claim.  Sometimes people are pleasantly surprised at what’s covered and replaced, while other times people end up feeling like their insurance was inadequate for their needs.  Let’s take a look at what’s covered under most basic home insurance plans, what isn’t, and what you can do about it.

Types of “incident” covered under most plans

Fire & smoke, explosions, falling objects, impact by aircraft or land vehicle, riot, weather (i.e., windstorm, hail, lightning, damage because of snow, sleet or ice), vandalism, theft, transportation of personal property, electricity, some water damage claims, and accidental glass breakage.

Types of limits you can expect for most claims (contact your provider for specific limits relating to your plan)

  • Replace a stolen bike – up to 2K per bike
  • Collectibles (like cards, art, and stamps) – generally somewhere between 2K-3K total coverage
  • Coin and Money collections – 3K
  • Jewelry and watches – 6K total with general maximums of around 3K-4K per item
  • Money – $500 total replacement
  • Replacement of Household locks – 1K total
  • Replacement value of home up to your set insurance limit (this could include replacement of fences and one stand-alone structure like a shed)
  • Third Party Liability insurance (this is to help you if someone hurts themselves on your property and is generally between 1 and 2 million dollars)

Since most insurance plans also have limited access to replacement of specific items it might be a good idea to get some additional coverage on any antiques, cameras, computers, or other equipment that may not be covered under a more basic plan.

Things that aren’t always covered 

Water Damage

This one is a little tricky, since sometimes it is covered, whereas other times it’s not.  Most basic plans will not cover damages because of flooding or seepage (water coming in from small cracks in your walls etc.), however if the sewer backs up into your home and causes damage or water damage caused by an exploding pipe, backed up sink or tub inside your home you are usually covered.

Earthquake Coverage

This is usually an add-on that you need to purchase separately, but not a huge concern to most people in the GTA.

What about when I’m travelling?

Most insurance will cover some of your property while you travel, so if your luggage is stolen out of your hotel room you might want to consider making a claim, depending on what was lost.

What about after renovations?

It’s a good idea to let your insurance know about major renovations and upgrades that may impact your home’s value to make sure you get the coverage you need, particularly when your home value has gone up.

What’s my deductible like?

This is different from plan to plan. The average homeowner makes a claim on their insurance once every decade or so, and because of this infrequency many people are starting to move their $500 deductible up to a $1000 one to save money on their insurance each year.

The Best Advice

Take a bit of time to look at your plan each year when it gets renewed instead of just filing it.  If you upgrade anything in your life, be it your home, or investing in a great stereo system it might be worth it to connect with your provider or an insurance agent or broker to find out what coverage you have for that specific valuable to determine whether or not it’s time to change your plan.

 

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