Your home is one of the most significant purchases you’ll ever make in your lifetime. That’s why it’s important to protect your investment, so this wonderful asset can be enjoyed for years to come. At Oegema, Nicholson & Associates, our mission is to help Canadians effortlessly acquire this peace of mind. But before committing to a policy, it’s important to understand the basics of home insurance and what it entails.
Oegema Nicholson understands the world of home insurance can be complex and difficult to navigate. To make things easier, we’ve created a comprehensive guide to help you choose a policy that’s right for you.
Why invest in home insurance?
In Ontario, homeowners insurance is not required by law. But when closing on a property, most banks require proof of home insurance before advancing on the mortgage. So unless you can buy your home outright without a loan, you could say home insurance is a crucial piece of the purchasing puzzle.
Let’s say your property burns down after just one mortgage payment. If you don’t have insurance, what’s stopping you from not paying back the loan? This is why the bank wants to maintain an ‘insurable interest’ on your home at all times. Any loss or damage to this property would affect them financially. Home insurance protects their interest by ensuring the lender is reimbursed, even if the policy holder violates the conditions of the policy.
Aside from satisfying the bank’s requirements — home insurance is purchased for a number of additional reasons, including the following:
- Protects the home from a range of hazards, including fire, flooding, vandalism and theft
- Covers personal liability should someone be hurt on your property as the result of an accident or negligence
- Includes temporary housing and additional expenses coverage should you need to stay somewhere else following a disaster
Oegema Nicholson offers a fully customizable suite of insurance options designed to suit your unique needs. We understand that not all properties are built the same. That’s why we allow our clients to pick and choose the coverage that’s right for them. This means you’re never over or under-insured. Ultimately, our goal is to bring clients peace of mind to their everyday lives.
Terms you should know
The insurance world is full of terms that help shape our understanding of coverage options and limitations. To get a better grasp of your policy, it’s helpful to know the terminology. Not only will this help you communicate more effectively with your insurance advisor, but will help you make more informed decisions, too.
Actual Cash Value
This is the estimated cost to rebuild your home. It takes into account the age of your property, market depreciation and general wear-and-tear. This estimate is the maximum amount of money you’ll receive towards the reconstruction of your home.
This is the amount of money you must pay when putting forward a claim. In other words, it’s the portion of loss you’re responsible for. It’s important to clarify that only one deductible applies per claim. Let’s say your home suffers a serious flood, and all your personal items are destroyed. Not only will your house and belongings need to be replaced — but you’ll also need to stay in a rental while your home is being reconstructed. Even though multiple coverages are activated by the claim, you’ll only have to pay one deductible.
These are the items which are not covered under your insurance policy. Exclusions are typically categorized into three main types: policy, property and loss of use and liability. Under policy exclusions, your claim could be denied if you knowingly misrepresented facts about the property or conducted illegal activity from your home. Property and loss of use exclusions could include damage due to coastal flooding or failure to report a change in occupancy. Meanwhile, liability exclusions may include damage from war or acts of terrorism.
Types of home insurance
Oegema Nicholson offers various types of home insurance. In Canada, there are three policies available.
This is a basic policy that will protect your home from a specific list of ‘perils’. Water damage, fire and theft are all covered under this type of policy. At Oegema Nicholson, we offer some of Ontario’s most affordable premiums. But should you feel this basic coverage is not adequate, our friendly insurance agents would be happy to provide you a quote for more advanced coverage.
This type of policy protects against everything, except for a list of exclusions stated in your policy documents. Comprehensive coverage is the highest level of protection offered by Oegema Nicholson. Although this policy covers almost every peril imaginable, it’s still important to know there may be optional coverages. Check if things like jewelry or supplemental dwellings are covered.
Broad form is a good compromise between named perils and comprehensive policies. It bridges the gap by offering comprehensive coverage on the most valuable aspects of your plan, but provides basic perils coverage on personal items.
Why trust Oegema Nicholson?
At Oegema Nicholson, we believe clients should be treated like family. Proudly serving the areas of eastern Ontario and western Quebec, our mission is to connect customers with high-quality insurance policies at affordable rates. Our friendly team is committed to ensuring your best interest, which means we work hard to represent you. Whether you require basic insurance on your first home or complex coverage for your summer cottage, rely on our expertise to help protect your most valuable assets.
For more information on home insurance, call us at 613-224-1455 or contact us here.
Most insurers offer monthly payments with a financing fee normally added. 2, 3, 4 pay options(possible fee) are also available in addition to 1 pay with most insurers.
Some policies would cover a leaky roof – depending on the cause of the damage.
Some policies would cover foundation repair – depending upon the cause of the damage.
Mold is not covered under a homeowners policy
Home insurance is not mandatory, however if there is a Mortgage on the Property – the Mortgagee (bank/financial institution) would require a homeowner to carry insurance on the dwelling to qualify for financing
Home Insurance is to cover direct physical loss or damage as a result of an insured loss. Insured losses are determined by the type of policy purchased - available are Comprehensive Form (All Risks – subject to exclusions). Broad Form (All Risks on Building, Named Perils on contents). Basic Named Perils (Named Perils on both building and Contents). A Deductible applies to most losses - typically $1000.
Personal Liability coverage is for Liability arising out of the ownership or personal use of premises insured. Liability for negligent Actions causing bodily injury or property damage – worldwide.
Personal Property, Additional Living Expenses, Personal Liability
Dwelling, Detached Outbuildings, Personal Property, Additional Living Expenses Personal Liability