Cost of insurance
Do you live in a newly-built home or in a heritage home in the country? Is your home constructed of wood or brick? That’s just some of the information your insurer needs to determine your premium. When you purchase your home insurance, he’ll ask you a series of questions that will enable him to determine your premium. Take the time to answer them correctly.
Your home insurer evaluates certain features of your home, including age, location, construction material used or cost to rebuild in order to determine the required insurance amount. Note that the insurance amount for the building should not equate to your morgage but to the amount required to reconstruct it.
What is the deductible?
The deductible is the amount that you accept to pay in the event of a loss.
The home insurance deductible usually varies between $300 and $1,000. Choose your deductible based on what you’d be able to pay in case of a loss.
Your insurer also evaluates the fire protection services in the neighbourhood where you live. If a fire were to break out in your home, how far is the nearest fire hydrant? How far is the fire station from your home?
Your home insurer will take into account how many and what kind of claims you’ve already made. He’ll also look at the crime (theft, vandalism) and fire rates in the sector where your home is located.
Policy and coverage chosen
The level of coverage you choose determines your premium:
Type of policy chosen (Specified Perils or Comprehensive)
Endorsements (additional coverage) added your policy
The deductible you choose
Value of property to be insured
Your insurance premium also takes into account the coverage you’ve chosen.
Do you know how much the personal property in your home is worth? This information is important. If your home were destroyed by a fire, how much money would you need to replace all your belongings? Having an inventory will help you list all your belongings and know how much coverage you need.
is also one of the factors used by most insurers.
Features taken into account by your home insurer
The construction material used to build your home: wood, brick, aluminium siding or concrete
Your home’s age and size
Your home’s location: country or city? In a residential, commercial, new or historic neighbourhood?
Your home’s heating system (electricity, gas, oil), including a secondary source of heating, for example, a wood or gas stove
The cost to rebuild your home in case of a total loss. Note that this amount is not the same as its market value or its municipal evaluation.