Before leaving for your well-deserved vacation, you need to think of contacting your broker for information about what precautions you must take. This situation occurs all the time and is not strange in the least. In fact, very few people can say that they have taken all the precautions required by their insurance policy when preparing to leave for vacation.
UNOCCUPIED OR VACANT?
First of all, it is important to understand the difference between “vacant” and “unoccupied.” The Insurance Bureau of Canada (IBC) defines “vacant” as “circumstances where, regardless of the presence of furnishings, all occupants have moved out with no intention of returning to reside in the dwelling building.” “Unoccupied,” on the other hand, is generally associated with circumstances in which the occupants have left the premises temporarily, with the intention of returning. You need to know what term applies to your situation, since the implications with regard to your insurance policy will not be the same. In the case of your ten-day winter vacation, the term “unoccupied” would apply.
AN EXCLUSION TO REMEMBER DURING THE WINTER COLD
You hope to leave with peace of mind, since your insurance policy covers all the risks and you even made sure to add general coverage for water damage and the riders recommended by your broker. You are well aware that the most frequent claims made are for water damage. However, it is important to know that there are exclusions in your policy, even if your policy seems ironclad. Before you leave for your winter vacation, I would like to draw your attention to the following exclusion:
Exclusion—Water damage caused by rupture due to freezing:
During the usual heating season, of property which is located within:
- a heated building, if you have been away from your premises for more than 7 consecutive days, but you will still be insured if you had taken either of the following precautions:
- arranged for a competent person to enter your dwelling daily to ensure that heating was being maintained; or
- shut off the water supply and drained all the pipes and appliances.
[IBC 1501 form]
To summarize, if you haven’t taken the precaution of organizing a daily visit to your home (including your basement!) by one of your loved ones starting on the 8th day of your vacation to ensure that the heating is working OR if you have not made sure to shut off the water and drain your pipes and appliances before you leave, you are not covered for water damage caused by freezing. The majority of insurance companies offer a delay of 7 days, but read your contract carefully as certain only offer 4 days. Think twice before shutting off the heating to save on electricity!
You are probably saying that your situation is not the same: your insurance policy is more generous in terms of the number of consecutive unoccupied days, you live in a home insured under a farm insurance policy, you have a seasonal property, you have a business… You are right—the exclusion terms may vary based on the insurance policy that you and your broker chose in accordance with your needs and your situation.
For businesses, however, the exclusion is not formulated in the same way and is typically more general. For example, with the insurer Sovereign, damage to property that is situated, to the insured person’s knowledge, in a location that has been vacant, unoccupied, or closed for more than 30 consecutive days is not covered.
At Intact, for property insurance for farm businesses, the same exclusion that Sovereign had also applies. This means that if you are storing, for example, personal property in a barn that you have not visited for more than 30 consecutive days during the winter, it will not be covered in the event of damage.
Finally, here are few pieces of advice:
- Choose a trustworthy person who can commit to checking on your home daily in your absence.
- Ensure that this person locks the door when leaving and arms the alarm system.
- Set the thermostat at no lower than 17 degrees Celsius.
- Most importantly, always contact your insurance broker before a period during which your dwelling will be unoccupied in order to learn about the precautions you must take before leaving.
Have a wonderful vacation!