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Renting out your backyard pool might seem like a good way to make some extra income, but you should consider all the possible implications before doing so. It could leave you with no home insurance and huge legal bills.

First there was Airbnb in 2009, followed by Uber in 2012. A few years later came Uber Eats and the world would never be the same. The sharing economy continues to grow and evolve, and now the latest trend, which gained popularity during COVID-19 lockdowns, is pool sharing. Homeowners with backyard pools can now rent them out by the hour on sites like Swimply and, during the peak summer season, earn as much as $7,000 a month. This can be incredibly tempting, but comes with risks.

There is no home insurance company currently operating in Ontario that will cover you for renting out your pool. Business activities are not usually covered by home insurance. Some homeowners policies are eligible for a business endorsement that includes coverage for things like liability and contents, but insurance companies are very specific about the types of home-based businesses they will accept, and even about whether or not clients can visit you at your house. (In most cases, this is not allowed.)  

All this to say, this kind of coverage is not available for renting out your backyard pool, because insurance companies consider this an exceptionally risky activity.  

According to Swimply’s website, hosts are covered for up to $1 million in liability and $10,000 for property damage. This is not enough coverage. The rebuild cost of your home is likely somewhere between $300,000 and $1 million, so the property coverage is only for very minor damage that your guests could cause. What if they accidentally cause a leak that floods your basement, or leave a cigarette unattended and burn down your pool house? Even if you insist smoking is not allowed, it can happen.

Liability is an even bigger risk, and $1 million in coverage leaves you exposed. If, heaven forbid, someone should be seriously injured or drown while using your pool, you could face legal costs well in excess of $1 million. Statistics for Canada are hard to find, but in the U.S., the Consumer Product Safety Commission reports close to 400 deaths and 7,000 injuries a year related to drowning in a pool or hot tub. These numbers are just for kids under 15 years of age, and don’t include slip and fall injuries on pool decks (unless they lead to drowning). It is estimated that slip and falls lead to another 155,000 injuries every year in the U.S.

Swimply includes a general waiver of liability as part of its terms of service, and so guests using the website to book your pool have already agreed to assume the entire risk arising out of the rental (Section 7.2 of Swimply’s terms of service). Furthermore, the Swimply FAQs state that some hosts have their guests sign waivers for additional peace of mind. The bottom line is this: Waivers are not perfect, and courts don’t always enforce them. Just because your guests sign a waiver, does not mean you are free of liability.

There are a number of different things that can happen depending on when and how you choose to share the information with your broker or insurance provider. Here are a few examples:

The last example above might lead you to believe that your best option is to proceed without letting your insurer know. The problem is that it’s not always up to you. Material misrepresentation is usually discovered at the worst possible time, when you’re making a claim. Here are a few ways that can happen:

“Renting out your pool may not seem so risky, but you can’t be 100% sure of who you are renting to and how they will use the space,” says Mitch renewal broker Gareth Payne. “Insurance companies usually take a wait and see approach with anything new. Right now, you have to choose between renting your pool or having home insurance. I would pick home insurance every time.”

The worst part of any of the above scenarios may not even be the fact that your insurance gets cancelled. It could be that somebody gets badly hurt, and you don’t have coverage for your legal expenses along with any court awards against you. Because most business activities are excluded from your home insurance policy, that’s exactly what could happen.

That’s the kind of situation that we at Mitch want to protect you from, which is why we strongly recommend that you enjoy your pool with your friends and family, while knowing that if anything bad happens, you’ll be covered.

Spring is a time of renewal and new beginnings. But with warming temperatures, melting snow and heavy rain, spring floods can cause significant damage to homes and other property, leaving homeowners with costly repairs and restoration. Some of the damage can be covered by insurance, but prevention is the best way to protect your home.

Spring flooding can occur due to a number of factors, but the most common is a combination of melting snow and heavy rainfall. As the snow melts, it adds to the volume of water in rivers and lakes, causing them to overflow their banks. Heavy rain can exacerbate the situation by adding even more water to already swollen waterways, and saturating the ground around your home.

In recent years, the frequency and severity of flooding have been increasing due to changing weather patterns related to climate change. In fact the five most costly floods in Canadian history all happened between 2010 and 2020, and 20% of homes in Canada are considered at risk. In Ontario, major flooding caused by a heavy rainstorm in Toronto in 2013 led to more than $940 million in damage, the fifth costliest natural disaster in Canadian history.

Spring flooding can cause a wide range of damage to homes, including:

“For water in an unfinished basement, it typically takes at least three days just to dry it out,” says Noah Firestone, owner of Firestone Restoration in Ottawa. “If it’s a finished basement and the flooring is toast, then it’s a much bigger job.”

Firestone says that restoration costs start around $2,000 for a simple dry-out of an unfinished basement and $15,000 to $20,000 in a finished basement if floors have to be replaced. From there, it depends on the extent of the damage and value of the affected items, including floors, walls, wiring, cabinets and furniture.

Home insurance typically covers water damage caused by burst pipes or cracked toilets. Damage caused by natural disasters like spring flooding may not be covered, so it’s important to check your policy carefully.

Most insurance companies in Ontario now offer the following endorsements (extra coverage) that would pay for at least some spring flooding damage:

Check with your insurance broker whether these endorsements are already part of your policy, and if not, whether they are available in your area. Homes in certain postal codes known to be prone to repeated flooding, usually because they are close to a body of water, may not be eligible.

When it comes to costs related to spring flooding:

When water gets into your home, you may not be able to determine the extent of the problem without help from a professional.

“Homeowners usually won’t see how much area is actually wet,” says Firestone. “Usually the water has spread much further, and you can’t see it without moisture meters.”

In some cases, you may also encounter disagreements with your insurance company as to how much cleanup is needed and whether some items need to be replaced, especially when it comes to damage from category 3 (or highly contaminated) water. There are international standards set by the Institute of Inspection Cleaning and Restoration Certification (IICRC) for how to handle this kind of cleanup.

“We help the homeowner through it,” says Firestone. “To support a claim, I can show the adjuster infrared pictures of where it was wet, and quote the IICRC, where it says that if it’s category 3 water, it should be removed.”

Even if the water is not contaminated, certain items like laminate flooring, furniture and cabinets made of particle board can be permanently deformed by water damage. This will usually be resolved between you and your adjuster. Your broker can help.

“To understand your coverage, sometimes your broker is your best friend,” says Firestone. “They don’t have a vested interest in whether it’s covered or not covered. They can walk you through it and make sure you’re treated fairly.”

Here are a few things you can do to reduce the risk of water damage to your home and possessions:

Firestone also recommends running a dehumidifier in the basement all the time.

“Finished basement, unfinished basement, even if there’s a little seepage that won’t cause major damage, there’s always some humidity, and the more humidity, the more likely you’ll get mold.”

If you’ve already had a groundwater claim, your home insurer may ask for proof that you’ve fixed your foundation before your next renewal. This can be as simple as filling a crack, or in extreme cases you may need to dig around the perimeter of the foundation and seal it from the outside. Costs vary from $1,500 to $15,000 and won’t be covered by insurance. Likewise, if you have a sewer backup claim and don’t already have a backflow valve and sump pump, you will need to have these issues properly addressed, or you could find it a challenge to get home insurance in the future.

Mitch Insurance works with some of the top home insurers in Ontario. Talk to one of our home insurance specialists today to make sure you have the best coverage available for water damage. We can get you dozens of quotes and explain the coverages to you, and we’ll be there for you later if something happens. Give us a shout.

^[1] _{Note that the Ontario building code now requires all new homes to be built with backflow valves and sump pumps.}

Have a cottage that you only use during the summer? There’s a lot that can happen over the course of the winter months while you’re away.  Let’s take a look at some of things you may encounter when opening your cottage this spring, and what steps you can take to minimize damage and ensure a hassle-free cottage season.

Canadian winters are long, cold and windy. There’s a lot that can happen between closing day in October and reopening in May. So if you’re opening your cottage this spring, what can you expect to find?

“When we’re opening a cottage, the first thing we do is a detailed inspection of the property, to see what didn’t do well,” says Ken Pickering, owner of Husky Property Maintenance in Midland, Ontario. “Winds during the winter tend to be 20-25% stronger than in the summer, so often what we find are soffits and fascia that’s been blown apart, and rodents get in.”

Another common problem is damage to window screens. These are quite often blown off during windstorms, and because they are generally quite flimsy, they can easily be damaged beyond repair. These aren’t cheap to replace because they are not a standard size.

There are three kinds of water damage that are quite common with cottages. The first comes from burst pipes. If you don’t properly drain and winterize your water system when shutting down your cottage in the fall, the pipes can freeze and burst. With no one there to shut the water off, damage can be extensive.

And water issues are not limited to the buildings on the property. Problems with grading and drainage can cause significant damage to landscaping, driveways and more.

“Drainage issues rear their ugly head in the spring,” says Pickering. “People add an extra parking spot or pile wood somewhere to keep it out of the way. This can divert water from the spring thaw toward their foundation or crawlspace, or cause erosion. We see culverts getting backed up, and sometimes the edge of your driveway gets washed out.”

Shoreline erosion is also becoming more of a problem for an increasing number of cottage owners. This can often be mitigated with retaining walls and other erosion control measures.

A big difference between cottage coverage and other types of home insurance is that cottages are usually unoccupied for long periods of time. Insurance covers sudden and accidental damage, but if the damage gets a lot worse because nobody is there to take remedial action, then any damage that happens after the fact is almost always excluded, meaning it won’t be covered.

Here are some of the most common problems you might find when opening your cottage, and whether they are covered by insurance.

Similarly if a fallen tree damages the roof or breaks a window during the winter, the damage done by the tree would be covered. But if no one is there to patch up the hole and weeks later rain or snow gets in and causes problems inside the cottage, that would likely be excluded because insurance law requires you as the owner of the property to take reasonable steps to prevent further damage.

Pickering stresses the importance of properly closing your cottage in the fall, to prevent problems in the spring. “I always tell people, batten down the hatches in the fall. If something’s a little loose, it’s going to be fluttering in the wind for five months while you’re gone.”

Here are a few things that Pickering recommends doing when shutting down your cottage for the season:

“It’s all about inspection, Pickering says. “Be observant. Small things today can turn into big problems once wind or water have their way over time.”

Mitch has some great options for cottage insurance solutions to meet all your needs. Talk to one of our brokers for a free quote today!

Ontario municipalities are promoting service line warranties that cover underground pipes on your property. You may already have this coverage, and if you don’t, you can probably get it at a much better price, with higher limits, through your home insurance provider.

A number of Ontario municipalities have been mailing letters to their residents about a service line warranty offered by a private company called SLWC. The warranty is being presented as a solution to a problem that is “not typically covered by your insurance”. While there is a very small percentage of Ontario homes that can’t get this coverage through their home insurer, the truth is:

Service lines are the pipes and cables (water, sewer, electrical, internet, natural gas, etc.) that run underground from your home to the street. Lines that are on your property belong to you, but they’re not always covered under your home insurance, so if they are damaged, whether by wear and tear or excavation, you could be responsible for repairs.

“If pipes and cables are inside your house, they are protected by home insurance,” says Alex Hillhouse, Sales Manager at Mitch. “If they are under the street, the city is responsible for them. But between your house and the street, you could have a gap in coverage.”

The municipal program seems to target water and sewer specifically, while home insurance often covers other types of lines.

According to Hillhouse, about half of all homeowners in Ontario already have service line coverage.

“Some insurance companies include it as part of their standard policy wordings,” he says. “Those that don’t, offer it as an endorsement. The easiest way to find out if you’re covered is to consult your policy or call your broker and ask whether you already have service line coverage.”

Below is a comparison of the service line coverage offered through municipal warranty programs and what is available through home insurance. Note that the data for home insurance combines coverages from a number of different companies. For more details, contact your insurance provider.

“The warranties being offered through municipalities are generally much more expensive and offer a lot less coverage than what is available under home insurance,” says Hillhouse.

The warranties do have the advantage of no deductible, but in many cases if there is a rupture of a water line right beside your home, water could enter your house and cause additional damage. If you have a service line warranty, there would be no deductible for repairing the line, but there would be a deductible for damage to your house or contents. If you have service line coverage as part of your home insurance, the entire claim would only have one deductible.

“If you’re considering the warranty program, you should check with your home insurance provider first,” adds Hillhouse. “In most cases, you can get more coverage at a lower premium.”

If your home is not eligible for service line coverage for any reason, then Hillhouse says the open eligibility of the warranty program will allow you to get protection that is not available otherwise.

Ultimately, we think you deserve the best possible coverage at the best possible price. Give us a call and talk to one of our home insurance brokerss about your current coverage and whether service line coverage is available for you.

Spring is a perfect time to make sure your home is protected from common summer perils like falling trees, animal damage, barbecue mishaps and burglars. Don’t let these hazards ruin your summer fun.

Yes, summer is on the way, and while that means you get to enjoy backyard barbecues and sitting on the deck, it also means that your home is at great risk from certain hazards that peak in the summertime. Before you go get the sunscreen and your straw hat, you might want to make sure you’re protected from these common summer hazards.

In Ontario, storms happen throughout the year, but the spring is the time to inspect your home and the surrounding property to see how roofing tiles, fences, trees and other structures have fared over the winter, and take the necessary steps to avoid or mitigate the damage that a subsequent storm can cause.

This might also be a good time to talk to your broker about adding coverage for overland flooding. Different from “sewer backup”, overland flood coverage is for instances where spring melt or heavy rain causes an accumulation of water that makes its way into your home. Although this kind of flooding has become much more common in recent years, only about 15% of homeowners have this vital protection.

Like anyone, burglars would rather do their work when the weather is nice. Also, the summer is when homeowners are most likely to be away. And statistics show that burglaries are indeed more common in the summer months. Aside from the insurance implications, nobody wants to be the victim of a burglary. There are some common sense actions you can take to lessen the chances that it will happen to you.

During the winter, rodents or bugs will try to use your home to shelter themselves from the elements. Damage from pests is generally not insurable, so when you’re inspecting your home in the spring, if you notice any signs that insects or larger critters have established a presence in your home, you’ll want to get it taken care of right away. Watch for the following:

Of course, if you see actual live critters in your house, you can assume there are more. Get it taken care of by a professional as soon as possible. Again, damage from pests is not covered by home insurance, and if not addressed, can lead to serious structural damage to a home.

Every year in Canada, thirty or so people drown in backyard pools. Although stats aren’t diligently kept, there is evidence that many of these deaths could have been prevented through proper fencing and locked gates. Though home insurance covers you financially if someone drowns in your pool (and their family sues you), that’s really no consolation. It’s obviously much better to prevent drownings from happening at all.

If you have a pool or hot tub in your backyard, you should be familiar with the rules. Essentially, you need to have a fence around the pool with a locked gate, so as to prevent children from getting in. If you have an above ground pool, you should never leave the ladder attached to the pool when you’re not using it, again, so kids can’t easily get in.

If you have an in-ground pool with a fence, the spring is a good time to inspect it and make sure it’s in good condition.

Barbecuing in the backyard is a favourite summer pastime in Canada. But barbecues can be dangerous if not maintained and used properly. In the U.S., fire departments respond to close to 9,000 home grill fires a year, including close to 4,000 that spread to the house itself. The majority of the fires are started by gas grills. We couldn’t find stats for Canada, but it’s safe to assume that per capita rates are similar, meaning about 400 house fires a year caused by barbecues.

Here are a few precautions you can take to keep your family safe:

As long as you’re making sure that your home is safe for the summer season, it might also be a good idea to check your home insurance policy to make sure you have all the coverage you need, and that you’re not paying more than you should. One of our experienced home insurance brokers would be happy to get you 5 or more quotes from some of the best insurance companies in Ontario, and advise you on coverages that you may want to add to your policy. In many cases, we can get you a better price, for better coverage! Give us a call today.

Generally, if you’re hosting a small holiday party at home, you don’t need extra insurance. The liability coverage under your home insurance provides some coverage. If you’re renting a hall or hiring servers for a larger party, then you need a special policy that includes liquor liability coverage. Cost starts around $175.

As the holidays roll around, many of us start to think ahead to our next epic holiday party. And Mitch is right there with you. We believe in taking time to celebrate with friends and family, and the holidays are perfect for that.

The personal liability section of your home, condo or tenants insurance policy includes a certain amount of coverage if you have friends over and they end up driving drunk and hurting someone. This is enough coverage for most parties at your home.

If you want to be extra safe, it’s never a bad idea to get one-day liquor liability coverage (as part of an event policy) whenever you’ll be serving alcohol to your guests. It’s quite affordable. Practically speaking though, you only really need this coverage if you’re holding your party at a rented venue like a hall or community centre. Make sure to ask when you rent the venue whether they require you to purchase this coverage.

For parties of less than 100 people, party alcohol liability starts at around $175. The more guests, the greater the cost. If you have a live band, you probably need special event insurance, which will also cost you a little more.

Just to be safe, here are some party tips to keep your guests safe and avoid liability:

No Canadian court has ever found a private individual liable as a party host for a drunk driving accident. Of course you don’t buy insurance for what HAS happened, you buy it for what COULD happen. And the Supreme Court of Canada has said that a private host could be liable under certain circumstances, especially if they are actively encouraging the consumption of alcohol or drugs.

If you’re an employer, or if you run a business that serves alcohol, then it’s a completely different story. Restaurants and bars are routinely found liable for injuries and damage caused by drunk drivers, and there have been cases where employers have also been found liable when someone gets drunk at a work or after-office party.

We want to help keep you safe. Call one of our brokers today to chat about whether you have the right home insurance coverage and whether you might need a little extra coverage for your holiday shindig.

Special thanks to Gareth Payne for his help with this article.

A deductible is the part of a claim that you, as the policyholder, agree to take responsibility for. If you make a claim for $10,000 and have a $500 deductible, if the claim is approved, the insurance company will pay $9,500. If the claim is for repairs to your car, you may have to pay the deductible directly to the shop before they’ll fix your ride.

For home and car insurance, $500 and $1,000 are the most common deductibles. Some business policies have deductibles as high as $50,000 or more. You should make sure your deductible is low enough that you will be able to come up with that money on a moment’s notice if needed.

You can save about 10% on your home insurance and 2-3% on your auto insurance by increasing your deductible from $500 to $1,000.

To understand what a deductible is and why it exists, we first need to understand that insurance is there to protect you from costs that you can’t easily afford to pay for yourself. For example, if your house burned to the ground, most of us wouldn’t have the money on-hand to pay for it to be rebuilt. Although you can get insurance against smaller losses, it often makes more sense to just pay for these yourself. If your $900 golf clubs are stolen, most of us are able to buy a new set, whether it be paid for in cash or on a credit card.

Deductibles help to reinforce the above principle. If you have a $1,000 deductible, it wouldn’t make sense to claim your stolen clubs (even if the claim was approved, you’d get no money back). But it would definitely make sense to claim for your charred home. You would pay the first $500 or $1,000, but the total cost of rebuilding would be in the hundreds of thousands of dollars.

When you get car or home insurance, your broker will probably quote you a premium based on one of the standard deductibles, usually $500 or $1,000. Most insurance companies will allow you to opt for a higher one, maybe $1,500 or even as much as $2,500. A deductible can theoretically be any dollar value, and you can get a lower premium by increasing it, but on a standard auto policy, you typically cannot choose a deductible lower than $250, or higher than $2,500.

Deductibles can also be different for different types of claims. In an auto policy, you can choose a different deductible for collision vs. comprehensive claims, for example.

To illustrate how much changing your deductible can affect your premium, we ran auto and home quotes for four sample Ontarians:

All of the above premiums assume the following:

Based on the above quotes:

If you have to make a claim on your home insurance policy, you will always pay a deductible.

Deductibles work similarly for auto insurance claims. The exception is that there is no deductible to get your car fixed if the damage is related to an accident for which you are NOT AT FAULT.

Let’s go back to that case of the stolen golf clubs. But let’s say that they were worth $1,500 instead of $900. Even though you could be reimbursed $500, the fact is that it would count as a claim on your home insurance record. Here’s the most important thing to consider: In home insurance, it doesn’t matter whether the loss was your fault or how much the claim is for. Each claim you make is just a claim on your record. Having one claim on your record doesn’t make a big difference in the premium you’ll pay on renewal. However, that all changes if you have to make a second claim within a five-year period. Two claims in five years disqualifies you from many of the standard insurers. This means your annual premium could double or triple on renewal, and stay that high until the claims are five years old.

So if you’re thinking about making a claim for less than $5,000, you always have to consider:

Auto insurance is a completely different story. If a claim is not related to an accident (your car was stolen or a tree fell on it), it shouldn’t affect your premium on renewal, so you can go ahead and make a small claim, even if it’s a $1,300 windshield replacement and you have a $1,000 deductible.

If the claim is related to an accident, however:

The last possibility is that you are involved in a single vehicle accident. That means you hit a guardrail, a tree, a post or some other object (not a person). By law, even if it happens in the middle of nowhere in the middle of the night, you should go and report this accident at a collision reporting centre, and because there is no other driver, you are automatically at fault.

In this case, if you’re going to report the accident, you may as well claim your damage. The effect on your premium will be the same. If you’re not sure, here are a few things to consider:

There are other deductibles that apply for different types of insurance, and different types of claims.

If you have extended health benefits through your employer or membership in another group, it’s very possible you have an annual deductible. So, for example, you may have drug benefits, but you might have to pay the first $25 or $50 out of pocket for the year. Some plans have a $100 annual deductible that applies to your whole family, and any costs beyond that will be covered by the plan.

Just like with EI benefits, if you claim long or short-term disability through your workplace benefits plan, there is usually a waiting period before you can start collecting benefits. It’s typically five days for short-term disability, and 120 days for long-term disability. This waiting period is essentially the same thing as a deductible, in that it discourages smaller claims.

In Ontario, if you are injured by an at-fault driver in a car accident and choose to sue them for your pain and suffering, any award you receive is subject to a $40,000 deductible. The deductible won’t apply to any actual financial losses you sustain (medical bills, loss of income, damage to your property, etc.), but only to claims specifically for pain and suffering. So if a jury decides that you deserve $38,000 for your pain and suffering, you won’t receive a cent. This is a measure to discourage frivolous lawsuits and keep costs down in the auto insurance system.

Modifying your deductible can be a good way to make sure you have the right mix of coverage and price. Practically speaking, if you choose a higher deductible, you have less coverage, but you’ll also pay a lower premium. When you talk to one of our experienced brokers, they’ll walk you through the options and make sure you have the right deductible for your circumstances. Give us a call!

^{1 Quotes reflect CAA Insurance’s minimum deductibles, $500 for collision and $300 for comprehensive. Most insurers have maximum and minimum deductibles.}

Lots of Canadians really don’t care what the upper dollar limit on their home insurance policy is. Many will accept whatever their broker tells them it should be, and others may try to keep the number as low as possible, knowing that a lower limit means a somewhat lower premium. Especially if you have opted for guaranteed replacement cost, you may think your property is fully covered, regardless of what the stated limit is.

Well here’s a few things that you should know:

How does a co-insurance clause work?

Most co-insurance clauses require that your stated policy limit be at least 80% of the actual replacement cost of your home. If you have to make a claim and it’s determined that you didn’t have at least 80% of the required coverage, then you are responsible for the shortfall, and will have to cover part of the loss yourself.

Any claim you make will be subject to the following calculation:

[Actual policy limit] / [80% of actual replacement cost] = [Percentage of the loss covered]

Example #1 (total loss):

You own a home with an actual replacement cost of $500,000. You opt for a policy limit of $350,000.

If your home burns to the ground, presumably it will cost $500,000 to rebuild it. But because you don’t have enough coverage, your claim payment is subject to a co-insurance calculation:

Actual replacement cost: $500,000

Policy limit: $350,000

Amount of loss: $500,000

$350,000 / (80% of $500,000) = 87.5%

So the insurance company will pay you 87.5% of the loss ($437,500), minus your deductible ($1,000) = $436,500. You’ll be on the hook for $63,500 out of your own pocket.

Example #2 (partial loss):

The calculation is exactly the same for a partial loss. So assuming the same home and same policy limit, if you suffer a $35,000 loss, the calculation is as follows:

Actual replacement cost: $500,000

Policy limit: $350,000

Amount of loss: $35,000

$350,000 / (80% of $500,000) = 87.5%

In this case, the insurance company will pay you $30,625, minus your $1,000 deductible = $29,625, and you’ll be left to cover the remaining $5,375.

Why is my limit too low?

There are a number of reasons why you might find yourself with a policy limit that doesn’t reflect the actual current replacement cost of your home. The most common reason is that you haven’t reviewed your policy in a long time, and your limits have fallen behind inflation.

Even though inflation is fairly low in Canada, between 2010 and 2021, prices in general have increased by about 17%. In terms of construction costs, the number is closer to 30%, and a big chunk of that increase has been over the last year and a half, with the pandemic creating shortages of a number of building materials.

If the actual replacement value of your home was $300,000 in 2010, it could be $390,000 or more today. Even if you were well within the 80% coinsurance limit back then (say you had a $280,000 limit), today that would be nowhere close to enough coverage.

The other thing that many people forget to do is inform their broker about renovations to their home. Most policies require you to notify your insurer/broker about any work done to the home that significantly changes your level of risk, or work that adds more than $25,000 to the value of the home.

More specifically, you should make sure to let your broker know at renewal if you’ve done any of the following:

These changes would definitely add to the replacement cost of your home, whereas simply updating floors, counters, cabinets and fixtures would not, even if you spent $50,000 or more doing so. Remember that insurance companies assume that there are periodic updates done to any home, and this is all factored into their replacement cost estimates.

^{Note: Just because it doesn’t add to the replacement cost of your home, doesn’t mean you shouldn’t document your renovations and additions. In the event of a major loss, especially a fire, you’ll need to show some proof that you had hardwood floors, marble countertops etc. Keep receipts and take lots of pictures, just in case.}

The value of a good broker

It’s a big part of your broker’s job to review your policy with you at renewal, and make sure that if anything has changed over the past year, those changes are reflected. Brokers have access to apps that can calculate your home’s replacement cost based on square footage and a number of other factors. These apps do capture inflation in their calculations, but of course there’s no way for them to know about your renovations. So at renewal time, if you don’t voluntarily disclose that your home has undergone renovations (see above), your broker should ask.

If you have an older home and are concerned that it may be underinsured, one of our seasoned brokers would be happy to review your policy with you and advise on whether you might need to update your policy limits. That’s just how we roll at Mitch. Sure, we want to give you the best possible price, but we also know that the last thing you want is a nasty surprise when it comes time to make a claim. Give us a shout.

An alarming number of renters in Canada have no tenants insurance policy, leaving them vulnerable to such perils as fire, water damage and theft, but also to financially devastating lawsuits and even potential homelessness during long periods of reconstruction. And yet tenants insurance is not only cheaper than most think, it can also save you money in the long term, and in some cases, keep you from being evicted.