You’ve just bought a new home in the GTA, and now you have to worry about insurance. Home insurance protects you and your finances from several unanticipated possibilities, including:
- Loss in case of an accident such as a fire;
- Personal liability in case of injury to someone else on your property; or
- Loss of contents in case of burglary or accidental loss.
After an insurance loss such as a fire or extreme weather, it can make a lot of sense to hire an insurance lawyer in Toronto especially if the damage is significant. Law firms that specialize in insurance claims can perform all of the responsibilities of a public insurance adjuster as well as advise you on legal issues, or take the claim to arbitration and/or court if absolutely necessary. An insurance lawyer in Toronto will help you understand your home insurance policy and what you are eligible to claim.
But getting the right insurance policy can save you a lot of grief and protect your money long before anything unfortunate even happens. These are some of the things you should watch for when shopping for home insurance in Toronto.
#1 Get Enough Coverage
There are three signs that you don’t have enough coverage or you have the wrong type of coverage:
- Your policy limits would not cover a total rebuild of your home or replacement of all of your contents;
- Your policy does not include certain “perils” (types of loss, like a fire) that you should be concerned about; or
- Your deductible is higher than what you can afford to pay.
There are some other common triggers to becoming underinsured, including renovations that are not accounted for in your policy or an acquisition of a lot more possessions (or high-value possessions) than you had when you initially bought your policy.
A changing climate can also mean that certain insured perils are a bigger issue now than when you got your policy. In Toronto, overland flooding is now a risk, and the city has seen several major incidents that left insurance companies inundated with basement flooding claims. For some carriers, flooding insurance is only now becoming available in the area.
#2 Your Policy Covers Replacement Cost
In a city like Toronto, real estate values are exceptionally high. In the case of a total loss, such as if a home were burned to the ground, it’s important to know that your policy does not cover the market value of your home, but rather the cost to repair or replace it after serious damage. It doesn’t matter how much your home is worth; the insurance pays out the cost to rebuild it.
#3 Bylaw Coverage
There are thousands of older homes across the city, and many of them are not “up to code” when it comes to safety and structural elements. You don’t need to “keep up” with most codes. Once work is complete, any deficiencies become “grandfathered in. However, once you renovate or rebuild (including repairs made after an accident), you have to follow the current building code. Unless you have bylaw coverage, your insurance policy may not have to cover increased costs associated with complying with the upgrades.
#4 Upgrade Your Contents Insurance
Depending on when you got your home insurance, the contents section may be significantly outdated. Have you since acquired expensive electronics, jewelry, fine art, or even new furniture? You should have your coverage limits updated to reflect new purchases if your content is now worth more.
#5 Check Your Deductibles
Not only should you make sure you have enough in your emergency savings to afford your deductible, you should also make sure you know all of your potential deductibles. Your deductible may change depending on the circumstances, such as the type of loss (insured peril).
Be prepared for anything. Not only are hazards such as fire always present, but extreme weather is becoming more prevalent in Toronto. Make sure you’re not underinsured.