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Having a home of your own is an exciting accomplishment, but it also comes with certain responsibilities. One of these responsibilities is making sure that your home and its contents are protected from the unexpected. That’s where homeowner’s insurance comes in.
We spoke with Andree Crawford, Account Director at Gifford Carr Insurance Group, who kindly shed light on some of the basic questions and considerations about homeowners insurance, and what buyers should know about it before heading to the market.
Who Should Get Home Insurance?
“Well, the simple answer is – anyone that owns a home. Insurance is designed to protect homeowners from a variety of unexpected costs that could be financially detrimental. So, anyone in the process of purchasing a home should start thinking about insurance as soon as possible.“
“To be slightly more specific, an insurance policy will be under the name of the registered owner of the home. This would be whoever is named on the deed or is responsible for making property tax payments.“
What About Renters?
“Renters who are looking to obtain coverage for their contents will apply for tenant’s insurance, which is a different type of policy altogether. However, if you start building a rapport with your insurer as a tenant, you may be eligible for more favourable rates when you purchase a home in the future.”
What Does Home Insurance Cover?
“Generally speaking, home insurance is designed to cover sudden or accidental loss. In other words, things that don’t occur over time. For instance, costs relating to maintenance, basic wear and tear, or mold wouldn’t be covered by a homeowner’s policy.”
“Instead, home insurance is intended to cover events like theft, fire, or certain severe weather incidents. There are standard inclusions (and exclusions) in a basic policy, however, homeowners will have the opportunity to add on optional coverages like flood and earthquake, claim forgiveness, and extra-valuable articles like jewellery or art.”
“Upon delivery, a good broker will ensure the client has a strong understanding of what is (and isn’t) included in their policy.”
Getting ready to buy your first home? Check out these pages from our site for an idea of what you can expect throughout your buying journey.
- Explore Our Current Listings
- First-Time Home Buyer FAQ
- Do You Need a Real Estate Agent to Buy Pre-Construction?
How Soon Should You Contact Your Insurance Broker Ahead of a Home Purchase?
“Ideally, home buyers should contact their broker before placing an offer on the home, or if applicable, before their conditions expire.”
“When the market was at its most competitive, we saw many buyers submitting offers without a condition of insurance. This can be a somewhat risky move as a lot of insurance companies today are looking to tighten what risks they take on.”
“In Ottawa, each decade of home construction comes with certain considerations that inform insurers’ decision-making. As brokers, we help buyers collect important information about the home they’re thinking about buying, such as the age of the property, plumbing type, electrical, condition of the roof, and a number of other details.”
“Once the required information is collected, we connect and quote with multiple insurance companies and offer the most favourable options to the client to make an informed decision.”
A note from our team – Your real estate agent can help you decide which conditions will be most appropriate to include in your offer if you haven’t yet confirmed coverage before signing your agreement.
How Much on Average Should You Budget For Insurance?
“It really depends. Factors such as personal credit, insurance history, and past claims will all influence your premiums. If all those details are in good order, and you’re buying an average-priced home in Ottawa in today’s market, a budget of $1200-2500 per year can typically get you a sound policy. The key word here is typically, every home is unique (with unique risks), which means so is your insurance policy.”
What Factors Impact Your Premium?
“Today, what we’re able to do with technology has reshaped how insurers approach premiums. Rather than broad strokes, premiums are individually calculated based on the unique details of the home itself as well as the buyer. It really is quite finite.”
“In addition to the property’s precise specifications, insurers pay close attention to credit history. Statistically speaking, the stronger an individual’s personal credit, the less likely they will be to make small claims. We’ve seen instances where owners with great credit have earned fairly large discounts on their premiums.”
Buying a home in Ottawa? Explore these links for help in building your budget.
- Financing a Home in Canada For Newcomers
- Calculate Your Buying Costs
- Buying an Ottawa Home? Read This First
How Long Does it Take to Get Covered?
“Technically, a buyer could get covered in as fast as a business day if there are no issues, however, it’s best to be proactive as you might need to do some back and forth with your broker. If you wait till the last second, it could cause delays. Preferably your broker will have a week or two’s notice to ensure you’re covered and have your binder in hand before your purchase closes.”