67% of Canadians believe that, when calculating home insurance premiums, insurers consider whether the outside of a house is brick or aluminum siding.
 They are right. Most insurance companies do use type of construction as a rating factor when calculating home insurance premiums. For instance, construction type is factored in when insurers calculate the building replacement cost (i.e., what it would cost to rebuild the dwelling with materials of like kind and quality, if it were destroyed).
Click here to learn more about how home insurance rates are calculated.
Click here to watch the "Home Replacement Cost" video.  (3min., 15 MB) |
73% of Canadians believe that the cost of their home insurance is affected by the type of electrical wiring in their home.
They are right. How much you pay for home insurance depends on a number of factors including the kind of wiring you have in your home. Some older types of wiring, such as knob-and-tube or aluminum, can increase the chance of fire, especially if the wiring has deteriorated or been damaged during renovations. Some insurance companies want a guarantee that a home does not have this wiring, some may give you time to have it removed, while others might request an inspection to ensure its safety.
Click here to learn more about how home insurance premiums are calculated. |
39% of Canadians believe that their home insurance covers them for damage caused by flooding due to spring run-off – the melting of large quantities of snow and ice.
 They are wrong. Damage caused by melting or moving snow is generally not covered by home insurance. Home insurance is meant to help policyholders cope with the financial consequences of unpredictable events that are “sudden and accidental.” Predictable or preventable events are not covered. These are called “uninsurable perils.” Damage caused by melting or moving snow is considered predictable, so it is an uninsurable peril. For more information about home insurance, click here.
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50% of Canadians believe that their home insurance doesn’t cover damage caused by an “act of God,” such as high winds.
| They are wrong. There is no blanket exclusion in a home insurance policy for “acts of God” or “acts of nature.” In fact, you will not find either of these terms anywhere in your policy. The truth is, some damage caused by nature and the environment is covered, and some isn’t.
For example, damage to your home caused by wind or hail is generally covered by home insurance if the damage is done to the outside of the building. However, items such as antennas, satellite dishes, etc., are not covered. The interior of a building and its contents are covered only if the storm has first created an opening.
Damage caused by flooding is generally not covered (see #1, above). Damage caused by the shaking of an earthquake is also generally not covered, but this type of coverage can be purchased as an add-on to your policy.
For more information about home insurance click here.
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60% of Canadians believe that the colour of their cars does not affect what they pay for insurance.
| They are right. The colour of your car does not affect your automobile insurance premium. You will not be asked to specify the colour of your vehicle on your auto insurance application. However, many other variables (such as your driving record, how expensive it would be to replace your car, and government regulations) are considered when setting auto insurance rates. Click here to learn more about how auto insurance rates are calculated. |
61% of Canadians believe that the cost of their home insurance is affected by whether their appliances are powered by gas or by electricity.
| They are wrong. The types of appliances in your home do not affect your insurance rates. Insurance companies base the cost of your home insurance on how likely you are to make a claim and what that claim is likely to cost them. Generally speaking, the lower the risk, the lower the premium. When it comes to the choice between gas and electricity, neither power source appears to be riskier than the other. So, the way your appliances are powered doesn’t affect what you pay for home insurance. For more information click here.
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58% of Canadians believe that the contents of their vehicles are not covered by their automobile insurance.
| They are right. Your automobile insurance covers the driver, the passengers and, depending on your policy, the car itself. It does not cover the stuff you carry around in your car. Typically, any sporting equipment (e.g., golf clubs), DVDs and MP3 players or other items that may get stolen from your car or damaged in a collision are covered by your home or tenant’s insurance. However, if you run a home-based business, your standard home or tenant’s insurance policy will likely not cover items related to that business (e.g., products or equipment) if they get stolen from or damaged in your car. Check with your insurance representative to find out what types of vehicle contents your home or tenant’s insurance covers. |
68% of Canadians think that auto insurance covers damage to their vehicles if they hit a moose, a deer, or any other wildlife.
They are right, if they have Comprehensive coverage.
If your vehicle hits a deer, or any other wild animal, any resulting damage to your vehicle is covered, likely under the Comprehensive section of your car insurance policy.
Talk to your insurance representative to learn more. For more information about car insurance, click here |
66% of Canadians say they are interested in learning more about how insurance companies respond during natural disasters. Click here if YOU are interested.
Answer: This January marked the 10th anniversary of the 1998 ice storm in Eastern Ontario and Quebec, which resulted in more than $1.6 billion in insured losses – a Canadian record. All data and research confirm that climate change is a reality and that such extreme weather is going to be more and more common. Canada’s home, car and business insurers will continue to be there to help Canadians recover from these events, and are committed to helping communities better prepare for them. Industry sponsored research activities include the Institute for Catastrophic Loss Reduction and the Research Lab for Better Homes, a one-of-a-kind facility at the University of Western Ontario that studies the effects of extreme weather, including Category Five Hurricane winds, on an actual house.
Click here for useful information on how to survive a natural disaster.
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69% of Canadians say they are interested in learning more about what options people have if they feel they are not receiving fair treatment from their insurance company. Click here if YOU are interested.
76% of Canadians say they are interested in learning more about how to minimize the amount they pay for insurance. Click here if YOU are interested.
| Answer: There are a number of steps you can take to lower both your car and home insurance premiums. The most common way is to increase your deductible (your share of the cost of a claim). Also, think about insuring both your home and your car with the same company as insurance companies often provide multi-policy discounts. Click the links for more money-saving tips on auto insurance and home insurance.
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39% of Canadians who operate small businesses out of their homes say they do not have insurance coverage – either extensions of their home insurance policies or separate business policies – specific to those businesses. This situation could have disastrous results for these entrepreneurs. Click here if YOU want to know why.
| Let’s consider an independent, home-based retail products distributor. It doesn’t matter what the product is (e.g., cosmetics, household cleaning products, food storage containers), the implications are the same. First of all, what if while you’re out delivering your orders someone breaks into your car and steals all your product? That loss will not be covered under your auto insurance policy, because theft of contents from a vehicle is covered under home or tenant’s insurance. However, because the product is related to a business, and you have not disclosed to your insurer that you are running a business from your home, your home or tenant’s insurance policy will not cover the loss.
Now think about the courier company employee that comes to your home to deliver your product, or business-related documentation. What if he or she slips and falls, suffers a terrible injury and decides to sue for damages? Will the liability portion of your home insurance policy protect you? No, it won’t. The injury was the direct result of an activity related to your business, therefore it is not covered under your personal home insurance policy. But that does not relieve you of the responsibility to compensate the injured courier. He or she has the legal right to pursue compensation through the courts. Without proper business liability insurance, you could be ruined financially if the courts find you legally liable for the courier’s injuries.
And what if one of the products you sell causes injury to a consumer? That consumer can sue the product manufacturer for compensation, but you would also be liable as the distributor of the product.
A house fire could also have devastating consequences for you. If everything related to the business is lost – all your product, computer equipment, office furniture, records, etc. – none of it will be covered under your home insurance policy. What is more, it’s likely that if you have not disclosed the existence of the home-based business to your insurance company, your home insurance policy will be voided and none of your loss will be covered.
Is it worth it? What you think you’re saving by not paying for an additional insurance policy is nothing compared to what you stand to lose. All Canadians running home-based businesses should consult their insurance representatives immediately to ensure they have the proper insurance coverage for their particular businesses. |
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