What home insurance covers

In a home insurance policy, a peril is an event, or risk, that your home may be covered for. Depending on your insurance policy and the extent of your coverage, the perils you’re covered for will vary. The perils you choose to include in your policy will have a lot to do with your specific situation and region. For instance, if you are in a region that is known for flooding, you’ll want to inquire about the availability of flood insurance. On the other hand, you may not need to list volcanoes as one of your perils. A big advantage to working with a broker is that you don’t have to figure it all out by yourself. A BrokerLink home insurance broker can help you navigate the ins and outs of what home insurance policy you need from an insurance provider. This list is not exhaustive, however, here are some examples of perils that might be included on home insurance policies.

• Fire
• Lightning
• Earthquake
• Flood
• Hail
• Hurricane
• Power Outage
• Tornado
• Volcano
• Wildfire
• Winter Freeze

It is also important to be aware of events or perils not covered by insurance. Maintenance costs and general wear and tear are just a few examples of perils not included in home insurance.

Home insurance categories

Although insurance policies can vary in complexity, coverage options can be classified into three general categories. Pay specific attention to the way perils are included or excluded as this is a defining factor between categories.

Basic/Standard

Although options will vary between providers, and also from region to region, the most basic insurance typically covers your home when there is damage from events such as fire, lightning, wind storms and hail. The types of events included in basic coverage can vary based on your home, but only the perils specifically listed can be covered.

Broad

Broad coverage is general protection for your home. You get a wide array of coverage with specified risk protection. In addition to basic elemental coverage, broad coverage can protect against things like damage from theft and vandalism. Broad coverage may also include coverage for unforeseen damages like burst pipes. Make sure to ask your broker what is and what is not covered by a broad home insurance policy as it must be specified in order to be covered.

Comprehensive

The most comprehensive home insurance will cover your home against damages from a wide variety of causes, but there may be some that are specifically listed as excluded. Many homeowners prefer comprehensive insurance for peace of mind and knowing if there’s damage to their home, there is coverage to protect it.

Average cost of home insurance

Average costs for home insurance are going to vary depending on individual situations and the types of coverage included. The best way to find out how much your home insurance costs is to simply get a quote. Our brokers can give you multiple quotes so you can compare coverage and prices from more than one insurance provider. It’s free and quick to do. What’s more, in speaking with a broker you can save the time you would have spent researching insurance policies and potentially save money by getting the custom plan you need.

The main factors contributing to the cost of home insurance and how your insurance is calculated.

There are many factors that affect the cost of home insurance. For example, the type of residence and the area you live in make a big difference in how much you’ll pay. It might be helpful to think of the factors within two general categories.

1. Information about your home and/or property:
   • The size of your home. In general, the more there is to insure, the more it costs to insure it.
   • The age and condition of your home. For example, older homes that haven’t been renovated or upgraded can sometimes cost more to insure as they pose more property and liability risks.
   • The location of your home. The surrounding environment plays a part in calculating your home insurance. For instance, the distance from a fire hydrant or the crime rate in your neighbourhood may affect your home insurance rates.
   • The value of your home and its contents. Construction materials and finishing could potentially impact the value of your home. Logically, the more valuable your home, the more expensive it would be to replace.
2. Information about you:
   • Your claims history. The more claims you have filed in the past can affect how much you pay monthly. If you have a history full of claims, insurance companies may perceive you to have a higher likelihood of filing another claim.
   • Your age and length of insurance history. A longer history of insurance for providers to consider may help them assess your risk with more confidence.
   • Some factors have more of an impact than others, but knowing what these factors are will help you better understand your insurance premiums.

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