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Your home is your castle. For many people, it is their biggest investment. Protecting you and your family from a major financial loss is the purpose of your Homeowner policy.
All homeowner policies are not the same. There are different types of coverage and policy limits vary from company to company. Here are the two most popular types of coverage:
Broad Form - A Broad Homeowner policy lists all the perils that will be covered on your home and contents. Such as; fire, theft, and vandalism to name a few.
If a peril is NOT specifically listed - it is NOT covered.
Comprehensive Form - This is also called an All Risk policy. This type of coverage lists all the perils that will not be covered. A comprehensive policy is the best coverage available.
If a peril is not specifically excluded, then it IS covered.
The comprehensive form is the policy we highly recommend!
Both policies are divided into two parts:
Section 1 - Property
Section 2 - Liability.
Section 1 - Property Coverages:
A. Dwelling - states the limit for which your home is insured. Our brokers complete a home evaluation guide based on information from you in order to arrive at an estimated replacement value for your home. This can be very different from the market price.
B. Private Structures - this is usually 10% of your dwelling limit. It provides coverage for garden sheds, detached garages, pool house, anything not attached to your house.
C. Personal Property – or 'contents' - The limit here is usually 60% or 70% of your dwelling limit. There are also specific limits on jewelry, coins, bikes, computer software, watercraft etc. If your possessions exceed these limits you will need to purchase a separate floater forming part of the policy. These limits and floaters should be custom tailored to your individual needs.
D. Additional Living Expense - sometimes called Loss of Use- this is 20% of your dwelling limit. This portion of your policy covers any expenses that you would not normally have. For instance, if you have a fire and are moved into a hotel, your hotel bill, dry cleaning, laundry services and restaurant charges, would all be paid for with this coverage.
Section 2 - Liability:
Legal Liability - All of our policies have at least a $1,000,000 limit. Liability covers you for damages that result from your proven negligence. Defense costs are included in this limit.
Voluntary Medical Expense - A limit of $1,000 or $2,000 is standard. This coverage allows you to voluntarily agree to pay for damages you caused. For instance, your kids are playing road hockey and your child accidentally injures one of their friends, resulting in a chipped tooth; you can pay the dental bill. With the legal liability above, you need to be found at fault in a court.
Voluntary Property Damage - The limit is usually $500. Similar to the above, for instance: the kids are running around and knock your sister's lamp off the table. You can have it replaced.
The above coverages are included in all Homeowner policies. We recommend a couple of additional coverages that are well worth their additional cost. Sewer backup or water damage coverage. This covers you for the sudden and accidental backing up or escape of water from sewer, storm drain, sump pump, eaves trough or downspout. It doesn't cover seepage over time or maintenance problems. If you are considering higher liability limits, you’ll want to read the section on Umbrella Liability Policies. You can also add floaters that cover boats, jewelry, furs, stamps, coins, computers, and home based business' to name a few.
Discounts
Many insurance companies offer substantial discounts. Here are some of the discounts you can use to reduce your premium:
- Multi-line Discount - insure your home and auto with the same company
- No Claims Discount - claims free for a period, usually 3 to 5 years
- Mortgage Free Discount - no mortgage payments and a discount
- Neighbourhood Watch Discount - if you are a member - cheaper insurance
- Age 50+ Discount - no, not a senior's discount - this is for mature adults
- New Home Discount – applies to homes built within the last 10 or 15 years
- Monitored Burglar or Fire Alarm - up to 15% off of your premium
All policies vary from company to company. The outline above is for reference purposes only.
The actual wording, conditions and exclusions on your policy will apply.
For more information, contact a Timmerman Insurance Broker today!
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