Purchasing a new home is an exciting milestone. With such a big decision ahead of you, it is important to keep in mind all the small decisions as well.
Did you know the house you choose can influence the insurance premium you pay? Here are some things to consider:
- Hot tubs and swimming pools. Although a fun addition to your new home, you may need to carry more liability insurance if you have a hot tub or swimming pool. Learn more about pool insurance here.
- Urban or Rural. Depending on your provider, your home can be in one of the following three categories for fire protection:
1. Hydrant protected – your home is in a town or city and you are within 300 metres of a hydrant.
2. Firehall protected – your home is rural and your home is within 11-13km of a firehall.
3. Unprotected – your home is rural and further than 11km from a firehall or hydrant.
Depending what category your home is, your premium will change
- Age of home. Older homes often stand out, offering charm and appeal. However, because these homes are older, the roof, electrical, furnace, water tank and plumbing are more likely to require inspections and replacements. Lower premiums may be applied if these elements are new. Your BrokerLink broker will be able to discuss the details with you. Check out Insurance for homes with character for more information.
- Risk of flooding. Floods are the most common natural hazard experienced by Canadians and the risk is often underestimated, according to Stats Canada. Floods can occur at any time of the year – due to events such as snow melt, rising ground water or heavy rainfall. Depending on your home’s area, you may be eligible for coverage. However, if your new home is located in a low-lying, flood-prone area, your insurer might not provide coverage. Discuss with your BrokerLink broker about options in your policy. Learn how to prevent flooding here.
- Hail risk. Hail storms can happen suddenly and quickly, occurring across Canada, with a high percentage in Alberta and southern Ontario. Aside from a mandatory deductible you are responsible for paying, comprehensive home insurance may cover hail damage to your home, including the roof, fascia and soffit. However, when it comes to your roof, it’s important to note that there may be limits to coverage and depreciation may be factored into your insurance settlement. Double check with your BrokerLink broker.
- Earthquake history. According to Stats Canada, approximately 5,000 small earthquakes are recorded in Canada each year, with nine earthquakes registering a magnitude of 7 in the past 100 years. There is a higher risk for an earthquake along the St. Lawrence and Ottawa River valleys, the coast of British Columbia and the northern territories. This may be covered in your comprehensive home policy. Be sure to double check with your BrokerLink broker.
During the home-buying process, be sure to:
- Have a home inspection. Purchasing a home can be expensive enough without having to deal with unexpected repairs. These issues should be caught in a home inspection where your home inspector will inspect the interior, exterior, foundation, plumbing, heating, electrical systems and roof of the property. The inspector will look for clues that may indicate bigger problems such as signs of mould, areas in need of repair and potential problems that could be costly down the road. Learn more about what to expect during a home inspection here.
Once you have found a home you are interested in purchasing, be sure to include a home inspection as a condition in your purchase offer. By including this condition, it will act as a contingency if major defects or repairs are identified during the home inspection, giving you the option to back out of your purchase offer without penalty within a specified timeframe.
- Know what you require for your home insurance. Check out our blog Home owners: do you have the home insurance you need? to get started. Your BrokerLink broker will help you with the details of your home policy.
Once you have found the right house for you, sit back, relax and let your BrokerLink broker find the best coverage for your new home.