When it comes time to buy your first home or sign your first residential lease, there are so many things to think about that it is hard to know where to start. One of the first steps is to purchase home insurance. Note that in order to do so, there are a number of elements to consider. First, you need to have information on hand about the insurance policy that currently covers your property. You must also have basic information about the building into which you plan to move, as well as a general idea about the amount of insurance needed to cover your property.
For general insurance, your years of experience are taken into consideration. Contrary to what some may think, never having had an insurance policy in your name does not mean that you have no insurance experience. In fact, basic insurance policies cover the person(s) named as insured on the coverage summary page, and
1. While living in the same household:
- his or her spouse;
- the relatives of either;
- any person under 18 years of age in their care; and
- any person 18 years of age or over under their legal custody, if stated on the coverage summary page;
2. A student who is dependent on the named insured or his or her spouse for support and maintenance even if temporarily residing away from the principal residence; and
3. Others who may be eligible to be included in the definition of named insured in certain situations that apply in the insurance contract.
In other words, this means that if you live with a parent or a family member, and if that person has home insurance, you have it as well. In most cases, insurers consider that you have at least 3 years of insurance experience, which reduces the amount of your premium. To prove this experience, you will need the name of the insurer and the number of the policy held by the parent with whom you live.
Your New Home
Before asking for a home insurance quote, make sure that you speak to the owner of the place to which you are moving to ask for some important information. To give you a quote, the broker will need the address, as well as the type of building—duplex, multiplex, or even a single-family home. Your broker will then be able to get a photo of your future home, and fill out certain information about the exterior, the type of roof, etc. However, you will be responsible for providing information about the type of heating system and the presence of an alarm system, so that your broker can determine your insurance premium. In addition, it will be necessary to know the approximate dates of renovations of major features, such as electricity and plumbing.
To sum up, here is the information you must obtain from the owner before calling your broker:
- The year of construction of the building
- The type of heating system
- The type of electric panel (fuses or breakers)
- The year of the most recent renovations for the following:
- Water heater
The Amount Needed for Your Home
Once you have answered the questions about your situation and your new home, your broker will be able to guide you to establish the amount of coverage needed for your policy.
When it comes to the appraisal of your property, the most suitable method is to enlist the services of a professional appraiser. This is the best way to determine the cost to rebuild your home. Some of the advantages of a professional appraisal are the co-insurance clause, which relates to partial or total loss, the inclusion of architectural costs to redraft the plans of your home, as well as debris removal costs, and an amount that accounts for the specific features of your home.
Did you know that water damage or a fire, even if only partial, can prevent you from rebuilding depending on your situation before the loss? For example, you may have to rebuild the facade of your home in brick, while before the loss, it was in vinyl since it had been built over 30 years ago. The city and your insurer accepted this because of the grandfather clause. Knowing about these legal provisions enables you to anticipate and adjust your insurance amount accordingly, so that you can avoid any unpleasant surprises.
The Amount Needed for Your Property
We suggest that you also make an inventory of your property, take photos and videos of what is found in your home, and send the content to your broker so that everything is in your file. Remember to mention high-value items to your broker so that you can receive specific coverage for them.
It is important to know that your insurer, in the majority of cases, will provide you with the replacement cost for your property. Even though you only have used furniture that you feel is not worth that much, the cost to replace it can be a lot higher than you expect. It is not surprising that most people undervalue their property.
As a newly insured person, it is completely normal not to understand the terms of your policy, but Lareau brokers are available to help!