When it comes to being a homeowner with a mortgage, home insurance is a must. In fact, your mortgage lender will insist you have it. Even after you pay off your mortgage, home insurance is very important to maintain.
Ask lots of questions
Make sure you understand the details of your policy. A Financial Advisor will be able to answer your questions and figure out exactly what kind of coverage you need to protect your home and its contents.
There are many kinds of policies available for homeowners. Some offer basic coverage of named perils including fire, theft, some types of water damage, smoke damage and vandalism, plus things you may not expect: lightning, explosion, falling objects and even aircraft impact. Others are comprehensive policies that generally cover most risks to a building and its contents but with some exclusions. While many policies have a lot in common, some cover more than others.
Find out what's excluded
You might have a policy that covers both buildings and contents for all risks and exposures, except for listed exclusions. Ask your financial advisor what the policy doesn’t cover, since all policies have excluded perils. It’s imperative that you know in advance, so there are no surprises when you make a claim.
It’s also important to understand what is included in your policy. Water damage, for instance, may not be covered depending on how the damage occurred. Some losses are not always top of mind. For example, as a condominium owner, are you covered if your washing machine floods and damages the unit below?
Liability coverage protects you anywhere
The liability portion of your policy covers incidents occurring at home, and also any legal responsibility arising out of your unintentional actions that harm others, wherever they occur. For example, if you have a swimming pool on your property, you absolutely need liability insurance.
Do you need additional coverage?
If you have expensive jewellery, collectibles, musical instruments, computers or a home business, you may need additional coverage to be fully protected.
Insurance needs can change
Home insurance is not static; your needs often change over time. For example, if you’ve increased the value of your home through additions or renovations, it’s important to let your financial advisor know to make sure you’re not underinsured.