Home and auto insurance can be more complicated than they seem at first glance. In some cases, it may be wise to purchase additional coverage to protect your property, your insurance premiums, and even your pets from unexpected events and claims. Let’s take a look at five types of insurance coverage that you may have never heard of before, but could save you money and headaches down the road.
A “named perils” home insurance policy only protects your property against damage from specifically named hazards. On the other hand, all-risk insurance covers damage to your home from all risks and perils except for those which are expressly excluded. Examples of hazards typically excluded from all-risk insurance include property damage caused by overland flooding and earthquakes.
What does all-risk insurance cover?
- Theft and vandalism.
- Weather-related incidents, including wind, storm, lightning, snow, and hail damage.
- Frozen pipes and water damage.
- Electrical damage.
- Fire and smoke damage.
- Impact of vehicles and falling objects (including trees, watercraft and aircraft).
- Property damage from riots or civil disturbances.
In essence, all-risk insurance covers accidents and weather events that damage your property, making it a nice addition to more common types of home insurance coverage, such as contents and personal liability.
Accident forgiveness can prevent your auto insurance premium from increasing if you are involved in an at-fault accident for the first time (or the first accident for a long time). To purchase accident forgiveness coverage, you will need to have a clean driving record and have been driving for at least six years.
You can’t purchase accident forgiveness immediately after an accident. After an at-fault accident, you may need to wait for that incident to be removed from your driving record before you can be covered under an accident forgiveness policy again. The reason for this is to reward good drivers with a consistent track record in case they make a single mistake or miscalculation. Not sure about your driving record? Just order a transcript from the Ministry of Transportation.
Accident forgiveness may not be available for all vehicle makes and models. It’s also important to note that if you are charged with a driving offence under Ontario’s Highway Traffic Act, accident forgiveness insurance will not pay for fines or legal fees.
Scheduling Items helps ensure that the full replacement cost of your most valuable possessions is covered under your home insurance policy. If your property is damaged due to occurrences like theft, fire, or extreme weather events, your insurance policy can pay to replace your home’s contents. However, there are sub-limits to the amount your insurer will pay to replace different types of items within your home, such as;
- Art and collectables
Therefore, if you have jewelry worth $10,000, but your jewelry insurance sub-limit is $5,000, you’ll want to schedule your expensive engagement ring or heirloom family treasures to make sure that the full value is covered.
You and your insurer need to set the agreed-upon value of your scheduled items. The best way to do this is to provide receipts or professional appraisals that prove the value of your scheduled belongings. This will ensure you receive adequate reimbursement if they are stolen or damaged. If you have scheduled property, you often won’t need to pay a deductible towards replacing your scheduled item in the event of a claim.
Overland Flood Coverage
Overland flood insurance protects your home against freshwater flooding that isn’t covered by most standard named perils or all-risk insurance policies. Overland flood insurance covers damage to your home and belongings from heavy rain, spring thaws, and the overflowing of nearby bodies of freshwater. You can receive insurance reimbursements for damage if overland flooding causes sewer backup in your home.
Flooding events that aren’t covered by overland flood insurance include:
- Water damage from burst pipes.
- Flooding caused by bodies of saltwater.
- Flood-induced back-ups of sewage water (“normal” sewage backup has its own coverage).
- Deliberate human actions that lead to flooding, such as the destruction of a dam.
Unfortunately, overland flood coverage isn’t available in all areas of Ontario. The Ontarians who live in low-lying areas most prone to flooding often aren’t eligible for this type of insurance. Those who are unable to purchase flood insurance may be eligible to receive government disaster relief funds. You may not be able to receive disaster relief if overland flood insurance is offered in your area and you choose not to purchase it.
Pet insurance helps you pay for your pet’s medical expenses. Medical care is expensive, after all. Spending a few hundred dollars per year on pet insurance can save money if your pet needs ongoing treatment, which could quickly add up to thousands of dollars.
Pre-existing or common conditions, such as hip dysplasia or dental issues, may not be covered by your policy—be sure to read the specifics of what your policy will cover. Like other types of insurance, pet insurance typically requires that you pay a deductible for your pet’s care.
What can pet insurance policies cover?
- Specified illnesses and hereditary conditions
- Emergency treatment
- Behavioural therapy
- Expenses from a sudden passing
It’s important to note that pet insurance doesn’t cover liability claims. For example, if your dog were to bite a neighbour, the incident would be covered under the personal liability coverage of your home insurance policy. For this reason, always tell your home insurance provider about your pets.
Not all types of insurance are for everyone, but you should stay informed about your options. Talk to your insurance provider about the cost of additions to your policy and set an affordable deductible.
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