Types of home insurance policies
Before deciding on purchasing home insurance, you will need to consider the following questions:
- What items do you want to insure?
- How much of a deductible do you want before your insurance covers the items?
- Will opting for a higher deductible really save that much on premium costs?
- Where is your home located? Is the area prone to flooding or other severe weather events?
- What won’t be covered by my home insurance policy?
Comprehensive policy
Although comprehensive home insurance is the most expensive, it also offers the most coverage, including:
- water damage not caused by floods,
- fire damage,
- loss/destruction of personal possessions,
- vandalism,
- theft and
- personal liability.
Comprehensive home insurance also covers roofing, flooring, appliances, light fixtures and even other structures sitting on your property, such as a separate shed or garage.
More on Comprehensive Home Insurance
Basic policy
With basic home insurance coverage, you receive minimal coverage for just your home and certain belongings in your home. In addition, mortgage lenders usually require borrowers maintain basic home insurance coverage as part of their home-financing contract. Damage caused by fire, hail, lightning, explosions and several other events are covered by a basic home insurance policy.
Named perils insurance coverage
Home insurance policies that provide coverage from damage or losses occurring to your property due to events or hazards listed on the policy are called a “named perils” insurance policy. This type of home insurance represents a more affordable alternative to broad or comprehensive policies that cover many more perils than indicated in a named perils home insurance policy.
Reasons why homeowners opt for named perils policies typically concern where their home is located. For example, a homeowner might not live in an area prone to flooding or earthquakes but remains concerned about theft, fire or other similar damage occurring. With named perils home insurance coverage, they only have to pay for coverage for the named events while omitting events much less likely to happen to their property.
Broad (property) insurance policy
Broad or property home insurance may not cover your home against damage caused by all perils. Instead, property insurance offers coverage for perils specified by the insurance company, which may not cover perils from which the homeowner wants financial protection. If the broad policy offered by an insurance company doesn’t sufficiently cover what the homeowner wants covered, they should consider purchasing a named peril policy to include coverage for events they consider worth covering.
The home insurance choice best for you
With so many variations of home insurance policies available, choosing the right one can be a challenge! The insurance experts at Mitch would be pleased to help you evaluate your needs and provide no-obligation insurance quotes. Feel free to give us a call at 1-800-731-2228 or email us at info@nullmitchinsurance.com.
Call today to see how our brokers can help.
You are unique, so are your insurance options.
As a brokerage for over 70 of Canada’s top insurance companies, we have access to a wide range of insurance solutions at some of the best rates in Ontario. Want to learn more about the coverage options available to you? Here’s a few of them.
