Mortgage companies in Canada require you to buy home insurance to cover the balance of your mortgage should your home need to be replaced or repaired due to fire or other damage. If you're looking for the right home insurance for you and your family, here's what you need to know.
You might be wondering how much coverage you need and what that will cost if you're a first time home buyer.
A home insurance policy covers the cost of replacing your home and things in it, in the event of fire, damage or theft. It protects you from liability too, in the event that someone's belongings are damaged while they're in your home, or if someone hurts themselves while on your property.
A comprehensive home insurance policy covers your home for all risks; natural disasters are not usually covered by insurance policies though.
Basic home insurance only covers the specific perils that are set out in the policy. It doesn't cover as many possible hazards as a comprehensive policy, so it's a cheaper option. Broad home insurance is a mix of comprehensive insurance and basic insurance policies.
How much coverage do you need?
If your home were wiped off the map, your home insurance policy should cover enough to entirely rebuild and furnish your home. A home builder can estimate what it would take to rebuild by doing a walk through of your home; base how much replacement coverage you'll need on that figure. Remember to note all the expensive/unique details that would drive up the replacement cost. Once you've determined the replacement cost of your home, you'll need to know what kind of coverage you want.
To make sure that you are completely covered and reimbursed if you have to file a claim for damages or theft, take an inventory of your personal possessions and the contents of your home.
If something happens on your property that would cause you to be financially responsible, such as if someone were injured on your property or some of their belongings were damaged, liability coverage protects you.
How much will it cost?
Depending on the amount of coverage required, as well as the deductible you choose, the neighbourhood you live in and other factors, the cost of your home insurance policy will vary. In general, the more coverage you have, the more it will cost.
The amount which you are required to pay against the full cost of the damage or repairs is called the deductible. You can choose to raise or lower your deductible when you purchase your insurance policy. As a rule of thumb, your monthly premiums are lower with a higher deductible. Shop around, and talk to your insurance representative about any questions or concerns, in advance of making your purchase.
You might be wondering how much coverage you need and what that will cost if you're a first time home buyer.
A home insurance policy covers the cost of replacing your home and things in it, in the event of fire, damage or theft. It protects you from liability too, in the event that someone's belongings are damaged while they're in your home, or if someone hurts themselves while on your property.
A comprehensive home insurance policy covers your home for all risks; natural disasters are not usually covered by insurance policies though.
Basic home insurance only covers the specific perils that are set out in the policy. It doesn't cover as many possible hazards as a comprehensive policy, so it's a cheaper option. Broad home insurance is a mix of comprehensive insurance and basic insurance policies.
How much coverage do you need?
If your home were wiped off the map, your home insurance policy should cover enough to entirely rebuild and furnish your home. A home builder can estimate what it would take to rebuild by doing a walk through of your home; base how much replacement coverage you'll need on that figure. Remember to note all the expensive/unique details that would drive up the replacement cost. Once you've determined the replacement cost of your home, you'll need to know what kind of coverage you want.
To make sure that you are completely covered and reimbursed if you have to file a claim for damages or theft, take an inventory of your personal possessions and the contents of your home.
If something happens on your property that would cause you to be financially responsible, such as if someone were injured on your property or some of their belongings were damaged, liability coverage protects you.
How much will it cost?
Depending on the amount of coverage required, as well as the deductible you choose, the neighbourhood you live in and other factors, the cost of your home insurance policy will vary. In general, the more coverage you have, the more it will cost.
The amount which you are required to pay against the full cost of the damage or repairs is called the deductible. You can choose to raise or lower your deductible when you purchase your insurance policy. As a rule of thumb, your monthly premiums are lower with a higher deductible. Shop around, and talk to your insurance representative about any questions or concerns, in advance of making your purchase.
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