Home insurance coverage questions

Whether it's your first time buying home insurance or you've never purchased coverage for your property before today, navigating coverage options can be confusing, to say the least. Luckily, we've compiled a list of some of the most frequently asked questions customers have regarding their coverage, so you can go into your appointment well-informed and confident.

Quick answers to your top home insurance questions

1. Is mould covered? Usually not.
2. Are sewer backups covered? If you have extra coverage.
3. Can I cancel insurance anytime? Yes, but fees may apply.

What Your Home Insurance Covers vs. Doesn’t Cover

When it comes to protecting your home, it's important to know exactly what your home insurance policy covers—and what it doesn’t. Not every type of damage or loss will be eligible for a claim, and gaps in coverage can lead to costly surprises. To help you better understand your protection, we’ve broken down the most common covered and uncovered scenarios below:

Are hot tubs and swimming pools covered by homeowners insurance?

Generally speaking, no. Not all home coverage will automatically extend to your hot tub or pool. It can vary between insurers. But, in most cases, you'll need to add additional coverage endorsements to your plan to ensure you have the right coverage for your home.

How much does a home insurance policy cost?

The average home insurance cost in Canada is between $1000 to $2000. But, like all types of insurance, how much you pay for your home insurance policy will depend on your risk profile as a customer and the insurer you're working with.

Is homeowners insurance mandatory in Canada?

No, homeowners insurance is not mandatory in Canada. That said, it's still a valuable safeguard that can protect your property, interests, and finances in the event something unexpected occurs. Your home may be one of the biggest investments you have, and with home coverage in place, you can have peace of mind that it's protected.

What questions do insurers ask when buying home insurance?

When you purchase a home insurance policy, your insurer will ask you a series of questions that will ultimately help it find you the right insurance coverage for your home. Common questions include where your home is located, the value of your personal property, whether you have an alarm system, what the square footage of your home is and other property details, to name a few. Beyond this, you'll need to bring the required documents, including ones that have your personal information on them and any previous insurance policies you may have.

Is mould covered by home insurance?

No, your home insurance policy does not cover mould. Mould is considered a maintenance issue that is the responsibility of homeowners to take care of. An exception to this rule is if you have water damage coverage or sewer backup insurance, and the mould growth developed as a result of the perils listed in the additional coverage options. We recommend you read your policy to determine whether you have coverage or not.

Are my appliances covered by my insurance company?

Your insurance policy will not cover appliances if the damaged property is a result of a lack of maintenance or old age. The only way your appliances will be covered is if the damage caused was a result of a covered peril listed in your personal property or dwelling insurance.

Is pest control covered by my insurance coverage?

Pest control is not covered by home insurance. These types of damages are solely the responsibility of the homeowner, as it is part of maintaining your home, which is listed in your insurance contract.

Can I cancel my homeowners insurance?

Yes, you can cancel your home insurance policy if you wish. However, there is a chance that your provider may charge you a cancellation fee for doing so before your renewal date. If you decide to cancel on your renewal date, you'll likely not be charged. Again, this can vary between providers. Therefore, we recommend speaking with an agent or broker for assistance or reviewing your home insurance policy for more information.

Is it possible to invalidate your home insurance?

Yes, you can invalidate home insurance. Some common reasons home insurance policies become invalidated include:

• Starting an at-home business and failing to notify your insurer about it or purchase separate coverage.
• Lying about the value of your home, its unique characteristics, or its current condition.
• Being dishonest about the value of your personal property.
• Conducting criminal activities on your property.
• Intentionally causing damage to your insured property or causing bodily injury to others.
• Failing to notify your insurer about changes or renovations performed in your home.
• Changing the security system attached to your home without notifying your provider.
• Failing to properly maintain your property throughout the year.
• And more.

How are home insurance premiums calculated?

When it comes to calculating your home insurance premium, there are numerous factors that your insurer will consider when assessing your risk profile, including the following:

• Where your home is located.
• How far away the closest fire hydrant or fire station is located.
• The age and current condition of your property.
• Your previous claims history.
• The type of insurance and policy limits you want, including whether you opt for optional coverages.
• Whether your home has any unique features or hazards.
• Whether you own expensive items like fine art, sports equipment, instruments, a wine cellar, and more, that may require more coverage.
• Whether it's your principal residence or a short-term rental.
• The deductible you choose.
• Whether you have smoke detectors and alarm systems installed.

How can I save money on my insurance premiums?

To save money on your premiums, here are a few tips you can follow when you're up for a renewal, without sacrificing having sufficient coverage for your property:

Bundle policies with the same insurer:

Bundling home and auto insurance policies is a great way to lower your premiums. Most providers offer a discount to those who have more than one insurance policy with them as a way of saying thanks for the business!

Shop around and compare quotes:

Because coverage is optional, you have the ability to shop around and compare quotes from different companies. Doing so can help you acquire the best deal available while ensuring you still have enough insurance.

Increase your deductible:

The deductible is the amount you pay out of pocket during a claim before your coverage pays for the rest. Upping your deductible can lower your premiums slightly. But only do so if you feel comfortable paying more and you can afford to do so.

Pay for your premiums upfront.

Insurers tack on administrative fees to those who pay monthly, as it costs them money to process your payments. To avoid these fees, consider paying upfront.

What is sewer backup insurance?

Sewer backup insurance is a type of optional policy that will cover the cost of repairs and replacements if your home or personal property is damaged as a result of a sewer backup.

What is overland flooding insurance?

Overland flooding insurance, or water damage coverage, will protect your home if it is damaged by overland flooding from lakes, ponds, or any other water that enters the home overland, in your area. This, too, is an optional policy not included in standard plans.

How can I prevent home insurance claims?

Preventable home insurance claims and personal insurance claims are the worst, especially because they are--you guessed it--preventable. To avoid having to go through the claims process with your provider, consider installing a sump pump and backwater valve. This can prevent flooding in your basement throughout the year. You may also want to consider a tankless water heater. Beyond this, ensure your HVAC system is up-to-date and working, and clean out your gutters during the fall and winter seasons to avoid home insurance winter claims.

How can I protect my home during the holidays?

To prevent damage during the holiday season, some holiday protection tips include turning off your main water valve when you travel, having a neighbour check on your home throughout the week, making it appear like someone is home, installing a security system, and keeping your travels off social media until you are home.

What is the difference between all-perils and specified-perils coverage?

All perils is a type of coverage that protects your home against a broad list of perils, while specific perils coverage will only protect your home against the hazards listed within your specific policy.

What is tenant insurance and why do I need it?

Tenant and renters insurance is a type of home insurance specifically designed for those who rent their homes from a landlord. This includes personal property protection, additional living expenses, and liability coverage. Note that your landlord's insurance will not protect you as a renter. So, while this type of coverage is not mandatory, it's highly recommended that you consider purchasing a policy to ensure you are sufficiently protected against different hazards.

What is the difference between replacement cost and actual cash value?

Actual cash value and replacement cost are two types of calculation methods used by insurance providers to determine how much you'll be compensated following an insured loss. If your policy follows a replacement cost value calculation, your provider will repair or replace them with items of similar value.

In contrast, with actual cash coverage, your insurer will compensate you for what your item was worth in its current condition, not the price you paid when you first purchased the item, by considering the depreciation that has occurred over time. In other words, you'll likely receive less compensation with these types of policies. Note that ACV can yield cheaper premiums than replacement cost value. However, like we said, you won't get as much money during a claim.

Will my home insurance premium go up after filing a claim?

Unfortunately, yes, if you do decide to go through the claims process with your insurer, your premiums will increase upon renewal. How much your premium increases following a claim will depend on the damage caused, your previous claims history, and more.

What is home insurance?

Home insurance, or homeowners insurance, is a type of coverage specifically designed to protect your home, property, interests, and finances against unexpected damages and losses. Within a standard home insurance plan, you'll find the following policies:

Personal property insurance coverage

Personal property provides coverage to your personal belongings if they are damaged by specific perils listed in your policy or stolen from your home, up to your coverage limits. To determine how much personal property coverage you need, your insurance company will ask you to provide a home inventory of your items and their relative value before suggesting which coverage limits you should purchase.

Dwelling coverage insurance

Dwelling insurance coverage will protect the physical structure of your home, including detached structures, such as your detached garage, and other structures on your property if they are damaged by an insured peril in your insurance policy. This includes fire and smoke damage, severe weather damage, theft, vandalism, and more. When filing a claim, your insurance provider will cover the cost to replace or repair all property damage, up to your policy limits.

Additional living expenses

If your home suffers an insured loss that makes your living space unsafe, additional living expenses will cover the cost of accommodations, meals, and other associated expenses until you are able to move back into your home.

Personal liability coverage

If someone suffers a bodily injury or personal property damage at your home, they have the legal right to sue you for damages. If a lawsuit is filed against you, this insurance policy will cover the cost of repairs, replacements, medical bills, funeral costs, legal fees, and other expenses associated with your settlement.

How BrokerLink can help

At BrokerLink, we help Canadian homeowners and renters find affordable coverage that protects their interests and finances against the unexpected. With access to numerous home insurance policies from some of Canada's top providers, our brokers can help you shop around, compare quotes, provide home insurance advice, and answer any questions you may have regarding your coverage. Beyond standard homeowners insurance, we've also got your back when it comes to:

• Condo insurance
• Vacation property insurance
• Mobile home insurance
• High-value home insurance

Get a home insurance quote [phone]