# Home Insurance Tips



## joelones (Oct 9, 2011)

Hello Guys,

I was wondering if someone would be kind enough to provide some home insurance tips. I'm kind of a like a deer in the headlights one this one. I've been calling a few places but seem to lost in the jargon, premiums seems to vary a lot. What should I ask for or steer clear away from?

Thanks


----------



## Woz (Sep 5, 2013)

I've used www.kanetix.ca to compare insurance costs and was fairly happy. At the site you can get quotes from multiple providers and you can play around with the policy options to see the cost difference. As it’s online you’re able to go a bit slower and lookup some of the jargon as you go and see all of the policy options.


----------



## carverman (Nov 8, 2010)

joelones said:


> Hello Guys,
> 
> I was wondering if someone would be kind enough to provide some home insurance tips. I'm kind of a like a deer in the headlights one this one. I've been calling a few places but seem to lost in the jargon, premiums seems to vary a lot. What should I ask for or steer clear away from?
> 
> Thanks


You don't mention what province you are in but you will have to fill in online or answer questions over the phone with standard fire/liabilty insurance.

Generally speaking: the fire insurance premiums are based (but not limited) to:

1. Kind of construction (brick veneer or other such as frame (wood)
2. Square footage for rebuild costs
3. Design of house (single detached, semi detached, row house, condo etc)
4. How far the property is from a fire hydrant or fire hall
5. Interior appointments...standard, deluxe
6. Type of heating (fireplace/wood burning appliances)
7. Age of house
8. Type of electrical wiring/plumbing
9. Personal contents riders (ie: jewelry/numismatic and other collections) 
10. Monitored alarm system for fire/theft
AND 
11A whether you belong to a professional group (engineer etc) or college/university alumni
11B The deductible you choose to keep the premiums lower...standard may be $1,000 of any claim that you have to pay out of your own pocket
$1,000 is standard, $500 cost a bit more in premiums..$0 deductible costs a LOT MORE.

* If your claim is less than the deductible..you pay for your loss. * So if your deductible is say $1000, you have to determine if the "loss or damage" is over $1,000,

Otherwise, your insurer will consider it your first claim within 3 years..if you have a subsequent claims within a short period of time, then you are considered (sometimes) to be a higher risk to the insurance company.

IE: report an item stolen such as a bicycle once...you have to give them a full description, a police report and a value for the bicycle.
Now..IF that bicycle cost you less than $1000 to purchase, and you opt for that kind of deductible.....*you are out of pocket and the insurance company STILL will consider it a reported claim.*

*Note: these days, if you are going to report a theft..better make sure it is worth reporting based on your deductible.* 

I have heard of some instances where the* insurer cancelled the homeowner policy after 3 claims in 3 years*. 

Once you get "blacklisted" by one insurer, it is more difficult to get insurance from the others AND your premiums will be much higher!


----------



## rikk (May 28, 2012)

Fwiw ... an item that appeared on my policy renewal this April was "Sewer Back-up Rider" at $395 which would have been about 35% of the total ... yikes ... submitted the written request to have that removed. I'm ok with $1K deductible and combine the policy with my auto policy for a dual policy discount. Discounts include age, claims rating, dual policy, loyalty and mortgage free for ~$1K with building covered to $580K, $2M liability, ...


----------



## MoreMiles (Apr 20, 2011)

rikk said:


> Fwiw ... an item that appeared on my policy renewal this April was "Sewer Back-up Rider" at $395 which would have been about 35% of the total ... yikes ... submitted the written request to have that removed. I'm ok with $1K deductible and combine the policy with my auto policy for a dual policy discount. Discounts include age, claims rating, dual policy, loyalty and mortgage free for ~$1K with building covered to $580K, $2M liability, ...


I was told in GTA, there were floods in the last couple of years. Those home owners were forced to spend lots of money to repair the plumbing damage including sewer back up. It was so bad that the insurance companies could not take it and had to charge more. 

So if other home owners and insurers cannot handle such scenario, reflecting on the coverage premium, are you sure you are different and immune to such scenario? What if your basement and ground floor is flooded with sewage and poo? It may take $100,000 to repair it... don't be penny wise and pound foolish. It makes no sense to cover your home for one type of damage but not the other... How do you pick it's fire or water? If we knew, we wouldn't need insurance right?


----------



## rikk (May 28, 2012)

^ I'm assuming you have such coverage ... read the exclusions, e.g. does not cover flooding of public system and consequent backup if you're connected to a public system. My decision, enjoy the day ...

OT: backwater valve


----------



## newuser (Sep 16, 2014)

Ask for group rate discounts for a group you belong to. E.g. University Alumni, CARP, company, IEEE, PEO, etc.

Get a higher deductible. Contrary to what the salespeople say, insurance is for disasters. You don't want to make small claims. Use credit card purchase protection and/or set money aside in a separate emergency fund for the small issues.


----------



## carverman (Nov 8, 2010)

newuser said:


> Ask for group rate discounts for a group you belong to. E.g. University Alumni, CARP, company, IEEE, PEO, etc.
> 
> Get a higher deductible. Contrary to what the salespeople say, insurance is for disasters. You don't want to make small claims. Use *credit card purchase protection* and/or set money aside in a separate emergency fund for the small issues.


I don't think that CC purchase protection will cover sewage overflows or fires. That is completely separate from purchase protection of consumer goods.
Sewer backup endorsement is a separate rider from the fire coverage.

In my case the deductible has been raised from $1000 to $2000 on my latest policy. If there was a catastrophic municipal sewer backup causing toilet effluent
to come into my basement..for sure..the walls, carpets, flooring and furniture would have to be thrown out and the basement treated by a professional
for mildew, black mold and human waste stuck to the woodwork such as the wooden wall supports.
In this case it would be a LOT MORE expensive than just $10,000 at todays prices..closer to $30,000....
In that case it doesn't matter about the deductible...as the damage far exceeds the actual deductable. 


BTW..water coming in from torential rains (ground water may not be covered)..as in the Calgary floods a couple years back. In catastrophic
flooding cases like excessive rains causing rivers to overlow their banks and that ground water finding it's way into basements.

If you read the fine print in some policies: "Windstorm or hail:
This peril does not include loss or damage due to: a) weight or pressure of falling ice or snow, whether driven by wind or not
b0 due to waves or floods, whether driven by wind or not.


----------



## rikk (May 28, 2012)

I think Woz post #2 has the right idea ... if you can do it online, take the time to learn the options, exclusions. I'm an old guy, I started many years ago through a broker who I'm still with, and who comes up with what they think is about right, I read it over, and then we discuss. Having said that, at renewal time, the correspondence comes directly from the insurer ... I take the time to read that over. To sum up, if you know someone with a broker that they'd recommend, you might try that as well as the online.


----------



## newuser (Sep 16, 2014)

carverman said:


> I don't think that CC purchase protection will cover sewage overflows or fires. That is completely separate from purchase protection of consumer goods.


Correct about the CC, but you skipped over the part about setting aside an emergency fund for small issues. Insurance is for the big issues like a sewer backup that you talk about. Some people treat insurance as some sort of savings vehicle -- they think if they are paying into it, they should make a claim to "get something back". That is the wrong thinking.


----------



## carverman (Nov 8, 2010)

newuser said:


> Correct about the CC, but you skipped over the part about setting aside an emergency fund for small issues. Insurance is for the big issues like a sewer backup that you talk about. Some people treat insurance as some sort of savings vehicle -- they think if they are paying into it, they should make a claim to "get something back". That is the wrong thinking.


Sorry, you were discussing having an emergency fund to cover the deductible...in case you may have a claim in the future.

I rely on my TFSA. It is my multi-purpose fund and could be used in an emergency to cover things like the deductible. 

The caveat about making claims to your homeowners insurance IS that *you better make it worthwhile to put in the claim.*

That's why there is a deductible. If your kid's $300 bicycle gets stolen...best not to put in the claim for that..otherwise not only will you be out of pocket in any case,* but your insurance company is counting that as a claim.*even if the deductible applies. 

With most insurance underwriters, they allow you one claim as a "freebee". If you put in another lowball claim within 3 years..watch your premiums jump up!


----------



## lb71 (Apr 3, 2009)

Note that if you have a sump pump, the sewer back up provision protects you against pump failure. Rates were increased (in the Toronto area anyway) after the July 2013 storm, and some insurers required home owners to install the back water valves just to get/keep coverage.

One thing you might want to consider is raising your liability. $1 million doesn't cover as much as it used to. I recently went to two on both home and auto. It was not much more.


----------



## carverman (Nov 8, 2010)

lb71 said:


> Note that if you have a sump pump, the sewer back up provision protects you against pump failure. Rates were increased (in the Toronto area anyway) after the July 2013 storm, and some insurers required home owners to install the back water valves just to get/keep coverage.
> 
> One thing you might want to consider is raising your liability. $1 million doesn't cover as much as it used to. I recently went to two on both home and auto. It was not much more.


Good points. Although the cost of installing a backwater valve may be around $1000 today....considering that the deductible for most basement flooding has
been raised to $2000, it makes more and more sense to have a plumber install the backwater valve (means busting up some concrete to install it in the floor drain), than risk a messy blackwater flood and the cleanup costs and inconvenience. *These days it's pretty much a cost of home ownership.*

As far as the liability insurance, with more and more Personal Injury/Ambulance chasing lawyers around advertising on TV every night that "*they will take your personal injury case and you don't pay unless they collect*"....you *really need the 2 million rider for Liability.*

Today a slip and fall on icy steps, or someone falling on your property and getting hurt could mean a lawsuit. In the wintertime there is much more chance
of a visitor/passer by being injuring by falling icles off roofs. Happened in Ottawa this past winter in the down town area..huge icicle fell off a high roof and
seriously injured a person passing by on the sidewalk. He was hit in the head. 

Now if his head injury turned out to be permanent disabling from earning a living..that standard 1 million may not be enough to cover you, *and the courts
couldn't care less if that was all the liability insurance you have...you pay the difference out of your pocket*.

One last thing on liability coverage. If you hire roofing contractors or renovators, MAKE SURE you ask that they are covered by their own liability insurance
and show you the certificate..otherwise..worse case scenario, one of their workers falls off the roof and is killed or permanently injured...who are
they gonna call?....their Personal Injury legal team..who will take on their case to get the maximum payout for their fees...and for their client.


----------



## Userkare (Nov 17, 2014)

lb71 said:


> Note that if you have a sump pump, the sewer back up provision protects you against pump failure. Rates were increased (in the Toronto area anyway) after the July 2013 storm, and some insurers required home owners to install the back water valves just to get/keep coverage.


The whole issue of water damage is confusing. I talked to my broker and still am not 100% certain I understand it all. Part of the policy deals with damage from water that originates within the house - the drain hose on the washing machine comes loose, for example. Another part deals with water entering the home from outside - sewer backup, river overflows, etc. I asked about rain water entering the house from a hole in the roof made by a falling tree in a storm; that seems to be covered by yet another part of the policy.

I was told that there were premium discounts for installing certain devices, such as an automatic shut-off valve when water spillage is detected. I have devices that sound an alarm, but that's not enough to qualify for a discount.

Bottom line - read everything and ask specific questions related to your situation.


----------



## carverman (Nov 8, 2010)

Userkare said:


> Bottom line - read everything and ask specific questions related to your situation.


Most insurers supply a several page 'fine print" description of what they cover and what they do not cover.
You really need to read the fine print first..but how many homeowners do? 

After the Calgary and Toronto floods, many insurers have changed their policies regarding water coming into basements and under what conditions.
Some conditions may be covered, others are not.


----------



## wendi1 (Oct 2, 2013)

My insurance guy just called me to talk about house insurance: he described three levels of protection for water in the house:

the one that I have: if pipes within the house break or clog or water comes into the house through a sewage drain, causing water damage, I am covered.
The next level: if water comes from the outside as a result of a pipe breakage or clog (this seems pretty rare - I declined).
The third level, which he assured me I could not get, even if I could afford it: flood insurance covering rain water, snow melt and rising rivers as well.

This was us talking, not a legal opinion...


----------



## Synergy (Mar 18, 2013)

wendi1 said:


> The third level, which he assured me I could not get, even if I could afford it: flood insurance covering rain water, snow melt and rising rivers as well.


Flood insurance / fresh water overland water protection is not currently available in Canada. Aviva is introducing this type of coverage in Canada starting in May. They will be the first insurance company to offer this type of coverage in Canada.
https://www.avivacanada.com/article...aunching-overland-water-protection-homeowners

This will be an interesting, costly and controversial roll out.

For the OP, if you're interested in learning - the insurance bureau of Canada offers some useful information to get you started:
http://assets.ibc.ca/Documents/Brochures/All-about-Home-Insurance.pdf


----------



## carverman (Nov 8, 2010)

wendi1 said:


> My insurance guy just called me to talk about house insurance: he described three levels of protection for water in the house:
> 
> the one that I have: if pipes within the house break or clog or water comes into the house through a sewage drain, causing water damage, I am covered.
> The next level: if water comes from the outside as a result of a pipe breakage or clog (this seems pretty rare - I declined).
> ...


 This is pretty much the case with my insurance. Some people living close to the banks of the Ottawa and Rideau rivers, got flooded last year with lots of water pouring into their basements. Most home owners ran outside gas operated sump pumps to keep the basements from filling up, but they were on their own when it came to repairing the damage..many were out thousands.

I think in the case of sewage overflow or water main breakage, the insurance company can recover some of their cost from the City's insurers, so they still offer that option at a higher premium. Mine isn't too bad about $159 with a $2000 deductible. 

Still worth the extra premium..because today it cost $75 just for the lumber delivery truck from H-D to bring any basement repair material to your home..never mind the cost of a handyman/carpenter to repair it.


----------



## carverman (Nov 8, 2010)

Synergy said:


> Flood insurance / fresh water overland water protection is not currently available in Canada. Aviva is introducing this type of coverage in Canada starting in May. They will be the first insurance company to offer this type of coverage in Canada.
> https://www.avivacanada.com/article...aunching-overland-water-protection-homeowners
> 
> This will be an interesting, costly and controversial roll out.


Indeed..I'm sure that they will have all sorts of clauses in this endorsement to protect their interests as well..such as the sliding deductible based on the premium paid on this rider.

Probably starting at $2000 deductible and maybe going to a less expensive coverage but at $10,000 deductible as an example.

Flash floods due to torrential rains because of terrain elevation can bring a lot of rainwater run off into basements that have been relatively dry for years.

You don't have to be living anywhere near a river for it to occur either...just a lot of water in a 24hr period and storm sewers that are inadequate or blocked somewhere..and you have surface water that will find it's way into your basement.


----------



## Synergy (Mar 18, 2013)

carverman said:


> Indeed..I'm sure that they will have all sorts of clauses in this endorsement to protect their interests as well..such as the sliding deductible based on the premium paid on this rider.
> 
> Probably starting at $2000 deductible and maybe going to a less expensive coverage but at $10,000 deductible as an example..


From what I've heard they are breaking the coverage down into 3 zones (low risk, medium risk & high risk). Premiums in the high risk areas will be in the thousands of dollars and deductibles in the 10's of thousands. Premiums in the medium risk zones in the hundreds of dollars, etc. 

They will be excluding those that live too close to rivers (I think it's within 100 meters) and those with reverse slopped driveways. These homes will fall into the 5% of Canadian that won't be eligible for coverage. According to Aviva, 95% of the population will be eligible for their new coverage. However, cynics will argue that those that really need the coverage (the 5%'ers) won't be able to get it and those that are eligible don't need it! With a few tweaks and competition from other insurance companies (once they all get on board) having the option to purchase some form of overland water protection is a good thing.


----------



## carverman (Nov 8, 2010)

Synergy said:


> From what I've heard they are breaking the coverage down into 3 zones (low risk, medium risk & high risk). Premiums in the high risk areas will be in the thousands of dollars and deductibles in the 10's of thousands. Premiums in the medium risk zones in the hundreds of dollars, etc.
> 
> They will be excluding *those that live too close to rivers (I think it's within 100 meters) and those with reverse slopped driveways.* These homes will fall into the 5% of Canadian that won't be eligible for coverage. According to Aviva, 95% of the population will be eligible for their new coverage. However, cynics will argue that those that really need the coverage (the 5%'ers) won't be able to get it and those that are eligible don't need it! With a few tweaks and competition from other insurance companies (once they all get on board) having the option to purchase some form of overland water protection is a good thing.


That's along the lines that I thought. I see a few of these reverse sloped driveways in the Ottawa area, where the garage is at least 6 or 8 feet below street level. I shudder to think what could happen if the drains at the bottom of the garage door can't handle the deluge, and the garage/basement fills up with a lot of water. 

Like everything else, the insurance industry is out to make a profit..otherwise they wouldn't be in the business for very long. They just spread out the risks across all their clients.

Last year I got a letter from my agent explaining the higher premiums, even though I haven't had a claim in 18 years (knock on wood)..citing the floods in Calgary and Toronto had necessitated them in raising the premiums in an attempt to try and recover some of their losses...(poor insurance companies. :biggrin

I was a bit annoyed about that at first, and started to check out on line if I could get a better deal..my house has aluminum wiring and a flat membrane roof. 

While the online quotes seemed "attractive" in keeping the premiums low..as soon as I followed up with a real agent, the premiums quoted were MUCH HIGHER than what was quoted on line. I decided to stay with my current insurer..the last thing I need is a wiring overheated fire and denied coverage. At least with an ESA inspection provided to my insurer, I can sleep at night knowing that they can't weasel out of any related fire claim due to the type of wiring because they have accepted this for 18 years now.


----------



## hystat (Jun 18, 2010)

I have a tip. When the insurer requests to do one of those inspections to supposedly see if your policy is appropriate, inform them that you require them to sign a letter that says they will only use the information for their internal purposes. 

I had one of those done a few years back. Then, Lo and behold.... on my next MPAC assessment.... there's some of the info- stuff I had done that didn't require a permit so the only way MPAC could know was from this report. 
I don't know if it's the company or the dude they contract to do the inspections but someone sold the info to MPAC.

The next time they requested to inspect, I notified them of the letter I would need. Suddenly a drive by was all they needed to do. We're good. lol


----------



## Synergy (Mar 18, 2013)

hystat said:


> I have a tip. When the insurer requests to do one of those inspections to supposedly see if your policy is appropriate, inform them that you require them to sign a letter that says they will only use the information for their internal purposes.
> 
> I had one of those done a few years back. Then, Lo and behold.... on my next MPAC assessment.... there's some of the info- stuff I had done that didn't require a permit so the only way MPAC could know was from this report.
> I don't know if it's the company or the dude they contract to do the inspections but someone sold the info to MPAC.
> ...


Very odd. If it was me, I'd be investigating that further. I always wondered how mpac would be able to gather information about interior reno's, updates, etc. for homes that have not been sold recently. Perhaps they have a few drones that are able to peek into your windows or see through walls. :biggrin:


----------



## fraser (May 15, 2010)

I would take the sewer backup rider even if I had to increase the deductible to keep the policy affordable. Especially if you have a finished basement. 

My daughter had Intact insurance. There was a fire in her building. She was extremely unhappy with the response to the claim and the amount paid. We had State Farm and did have a claim (in Calgary). They were excellent to deal with and extremely fair. I think that they may have sold their insurance business.

Take pictures and store them. If you have jewelry that you wish to cover take pictures. You may need a rider depending on the amount.


----------

