Saving Money on Insurance: Do Students In College Need Apartment Insurance?

Send to Kindle

McGill UniversityMcGill University (Photo credit: caribb)

I received an inquiry today from someone who was looking for a quote on insurance to cover their son while they were away at college. Although oftentimes the first response to this may be to simply do the quote and write a new policy (a quick and easy sale), I personally feel that a big part of being a broker is offering guidance and not just jumping at a sale. 

I thought my answer would be useful to many, so I am sharing it with you here. Before you jump at buying insurance, find out what your existing home policy covers (or does not cover) you could save yourself several hundred dollars a year with a little fact checking.

*Please remember this is simply a guide you must check with your specific home insurer to find out all the details because every policy is different. Knowing the basics can help you direct your questions and help you make an informed purchasing choice.

"I need insurance for my son away at college he is renting an apartment with several roommates"

When you have a student away from home registered in school full time, your insurance policy may provide coverage, before buying anything extra you can use these tips to make an informed decision . 

The first step to save you some money is for you to contact your current insurance broker and ask them what the coverage they offer on your home policy is for “Students away from home” . Many of the companies offer full coverage for the students contents, others offer up to a specified amount. If the coverage is already there on your home policy, there is no need for you to spend the extra money to obtain a tenant policy for him. Your insurance provider can guide you on this.

That’s for the contents.

What about Liability? Do they need that?

McGill student vote mob 2011McGill student vote mob 2011 (Photo credit: Adam Scotti)

Absolutely! Liability is extremely important for people who rent apartments. Liability covers you for anything you might be held responsible for as the lessee of the apartment. If your name is on the lease, then you could be liable for damages arising out of the use/control of the premises.

What could happen?

A number of things, water overflowing damaging the building, or people's property in units below yours. A candle could tip over and cause a fire taking down half the building! And let's not forget that when there are visitors, like, for example when you have a party, someone could trip and fall and hold you responsible! Start to think about it, a lot could happen.

Make sure to protect yourself with liability.

It is very important to make sure that your child has liability covering them. Therefore you would want to ask your current insurer if they can extend liability to the apartment . It may be automatically covered, but you can not take it for granted that it is as various companies have different restrictions and limitations. Often it is not automatically covered, you need to ask for it. If they confirm it can be covered or is already covered then your are well protected and do not need to spend additional money.

If they tell you then need to do an extension of liability, its usually at a minimal cost (ball park $30 per year or less). This would then protect your child's personal liability as the tenant of the apartment. If something should happen which and they are held  responsible then it is the liability portion of the insurance that will respond

Tip: Also find out if the liability they are offering you is limited to the premises, or if it will cover them worldwide.

What about the Roommates?

All the roommates should do the same as suggested above, they may all end up being able to be covered at minimal rates through their parents home insurers if they meet the criteria of a “student away at school”. 

If they do not, then to make sure everyone is protected properly, all roommates should have their own policy to cover themselves specifically. 

In some cases I have seen we have named roommates on a policy together, but this is a rare exception as it can cause problems in the long term and I do not recommend it. Insurance is a very personal thing that stays with you for several years. When there is a claim, it will remain on their claims record. The relationship between roommates is often fleeting and unpredictable - do you really want the responsibility of an insurance contract shared between people whose relationship is not really known. Insurance is about finances - thinking about it in this way often helps people understand why it is not recommended to take a traditional tenant policy and list a bunch of people who are not necessarily related closely, or who do not know each other very well.

Do you really want to take on shared responsibility for all their actions?


I Still Want to Buy A Separate Policy, Can I? What's the Advantage?

Yes there are some advantages to getting your child their own policy.

The advantage of doing it separately, as opposed to through your own insurance is that if there is a claim, you will keep it separate. In other words: you would not lose a claims free discount on your home, for something that would happen to your child. Claims free discounts can add up, in some cases to 25 or 30 percent discounts on the insurance cost. That’s a big savings.

A General Overview : Why does anyone need tenant or renters insurance anyway?

Still wondering what renters insurance is all about? This video by Chubb Insurance is quite well done, and helps explain it. Keep in mind that Chubb is a high value insurer and their policy is specific to their contracts, for specific information about what your policy covers, remember, you need to contact your own insurance representative because the details do matter and every company is different. If you don't have an adviser, and you're in Quebec or Ontario, then you can always get in touch , I'd be happy to help you figure out exactly what option and what coverage is perfect to fit your needs.

That's really what it's all about - what works for you.

I hope this article has been helpful to shedding some light on cost saving options and strategies behind insuring your kids while away at school.

What option do you think you would choose, or what have you done in your situation? 

Enhanced by Zemanta

Looks like Canadians Driving in Florida Will Be OK

Send to Kindle

A couple of weeks ago many Canadians were outraged because suddenly they had heard a law had been passed which appeared to require all drivers who were not from the USA to obtain an international driving permit to drive in Florida.

Finally after much confusion in the general public, the Florida Department of Highway Safety and Motor Vehicles issued the following statement :

"During the 2012 legislative session, the Florida Legislature amended section 322.04, Florida Statutes, to require visitors from outside the United States to have an International Driving Permit in order to drive lawfully in Florida. This change took effect Jan. 1, 2013.

It has come to the Department’s attention that this requirement may violate the Geneva Convention on Road Traffic (1949), an international treaty to which the United States is a signatory. Treaties to which the United States is a party preempt state laws in conflict with them.

Therefore, the Florida Highway Patrol will defer enforcement of violations of the amended statutory section until a final determination of the alignment of the amendment with the treaty can be made. Non-resident visitors to Florida who wish to drive while here will be required to have in their immediate possession a valid driver license issued in his or her name from another state or territory of the U.S. or from their country of residence. However, the FHP will not take enforcement action based solely on the lack of an International Driving Permit."

This information surely is a relief to many Canadians and "Snow Birds" who were already in Florida for their "Winter Stay" when the original information was released. The above statement was issued February 14th. According to VisitFlorida 3.1 million Canadians visited Florida in 2010. They suggest that despite the statement about the international permits, it is still recommended that you check with your local car insurer before you travel to Florida to make sure you will be covered, good advice regardless of the new law under review.

Driving Out Of Province & Your Insurance

Any time your vehicle is out of your country of residence for more than a couple of days, it always is recommended to check with your insurance company to see what their limitations are (if any) on out of country/province use. Sometimes they just put a note in the file acknowledging you will be using the vehicle out of country or even province, however other times if the trip exceeds a couple of weeks they may decide to add a small charge. Some companies do this after 3 weeks, others after six. I also have some insurers who don't charge anything. Each insurance company has their own rules on how they handle out of province exposure, so make sure to call and find out if you're with the best company for your needs - don't get caught by surprise. You might even save some money by finding out about the options!

Laws are different everywhere, so it's always better to be safe rather than sorry. Make sure that you do not have any issues if you have an accident or claim - always check with your insurance provider before leaving town. 

What your friends companies do may vary from your own - don't take a chance.

Want an International Permit Anyway? 

For those of you who decide you want to get an International Permit anyway, it's not difficult or that big a deal.

For all the hassle of following what the Floridians will be doing with this law, you may want to consider just picking one up. You have to be 18 to get one, with a valid canadian drivers license. The permit costs $25. You can contact CAA to find out more.

For people who are currently out of Canada, like our many residents currently in Florida, you can also request one by mail! CAA is the only organization in Canada authorized to issue an International Driving Permit.

  • Were you in Florida when news of this situation came up?
  • What are you going to do, pick up a permit anyway, or wait for the law to be amended?

Why Authorize a Credit Rating Verification on Your Insurance? To Save Money!


Send to Kindle

Our changing markets.


The insurance industry has changed. Top home and car insurance companies are now using credit scoring. In particular in personal insurance the way a risk is rated is becoming more individualized, offering substantial savings to target profile clients.

For many years the rate structure of insurance was based on claims frequency/incidence in the region, or other factors such as the type of vehicle. If an insurance company suffered many losses, or paid many claims over any given year, then it was natural to see rates increase and be shared amongst all policy holders.

In today’s competitive market, insurers have taken a fresh look at how they are determining the rates, and now they incorporate a new advantage in personal insurance: Stability and credit rating.

Stability or credit rating basically allows additional credits for you based on your actual situation. Although rate increases will occur with the insurers, this added benefit for target clients will allow a definite offset on rates.  In many cases we are seeing dramatic reductions.

Target clients with good credit scores will not see increases, they will see decreases and improved rates instead.

What if your credit score is not favorable? 

Clients who have less than average credit scores will not see increases based on credit scoring, but they will be subject to regular rates.

Why is the insurance company using credit scoring?

Research has shown that clients with poor credit scores are more likely to have claims. Rates are therefore determined on the actual risk, named insured (the person) included.

For clients who have average to above average credit scores, this added rating tool offers greater opportunity to maximize discounts and save money, while insuring personal property such as homes and cars.

As brokers this means that we have reinforced reasons to search all markets for the most competitive rates for our clients. This is our commitment.

 We are happy to know that when a client asks us, "Why do I have to pay for all the claims other people made, when I haven’t claimed anything?"


We now have a great answer and it is simple: "You don't".

Do you authorize credit scoring with your insurer? What are your thoughts?

Enhanced by Zemanta

How to Insure Antique and Collector Cars for Less and Save Money

Send to Kindle

Jay Leno driving up to the Emmy rehearsal 1993...Jay Leno driving up to the Emmy rehearsal 1993 in one of his antique cars, a Hispano-Suiza 8 (Photo credit: Wikipedia)

You may not be Jay Leno, but you may have a similar passion for antique cars!

There's good news - the car may be expensive, but the insurance doesn't have to be.

There are lots of options for Antique cars, and in this category, in our experience we can find excellent rates on insurance - and so should you, because the vehicles are not driven much and are usually very well protected and cared for.

Make sure you check for a specialized insurance company.

For example, the ones we use charge much less than our regular insurers, because they specialize in the antique market.

Agreed Value vs. Cash Value (and Limited Value) - It's not as simple as it sounds.

Be careful.

There are also additional considerations that the specialized markets may offer that are more advantageous than regular insurers, like making sure the coverage you get is agreed value and not cash value.

You have to know where to insure these special vehicles to get the best price and coverage.

Wondering what classifies a vehicle into this category?

Here's a guideline.

  1. Age of vehicle - 25 years or older is usually the ball park. However certain models and vehicles may still fit into the collector car category based on other factors like special features, limited production, etc.
  2. Use of vehicle - Annual mileage can come into play with some carriers, however not all carriers have this limitation. Some insurers will look at if it is used in the summer, vs winter - and others have more flexible guidelines. We have carriers that don't base it on any of this, and others that have very rigid guidelines. It's worth investigating, there are some definite advantages to knowing the options!
  3. Condition of the vehicle - naturally to be categorized as a collector car, it should be in excellent condition. Evaluations are not always required, depending on the insurance provider. We have some that absolutely require an evaluation, however higher end insurers that we deal with, such as Chubb may rely on their internal expertise rather than send the client out for an evaluation. In any case, when you have a collector car, it is recommended to make sure you get an accurate idea of the value from an expert.

Here's a great story from the NCIB, on a collector Corvette that was stolen then recovered 30 years later!

Enhanced by Zemanta

Insider Info: Buying a New Car? What Really Effects the Cost of Insurance.

Send to Kindle

Lamborghini's, Audi R8, 911 TTLamborghini's, Audi R8, 911 TT (Photo credit: RGT3 Pics)

Douglas Rice is a small business marketing specialist who writes great columns online. I first met Doug through 12 Most, where he is a weekly author. Aside from being a great writer with strong business advice and a gift for storytelling, he also has a background and an insider's view in automotive sales. It really helps to have some insider insight, when it comes to making big purchase decisions on a new car. I know that when ever I get a new one, I spend weeks going back and forth over what I really want. It can often be hard to decide with so many factors.  You should definitely check out his article: 12 Most Important things to Know Before Buying a Car.

Of course, in speaking with Doug, I mentioned the topic of insurance - this is something that people often leave to last minute.  Although Doug can speak to the tips on what to consider in selecting your new car, I thought I would share some tips to get you thinking and help you out on the factors in price for insurance before you buy the car.

What REALLY effects the cost of insurance?

Please note that  these are general guidelines, but hopefully they will help you on the right track, and will avoid any unnecessary surprises! Because when budgeting for your car, you'll also have to consider your monthly insurance payment.

What about the color?

First things first: In insurance you're the greatest factor. Yes YOU!

So, this variable remains constant, regardless of the car you buy. If you have speeding tickets, bad credit, move often (yes some insurers consider how long you've been at the same address and give discounts for that), where you live (the zip or postal code) and your claims history ( do you have claims?) are the strongest determining factors of rate.

I have seen rates double, depending on the area a person lives (city vs. suburb, etc). 

Let's not forget to consider the costs of young drivers, or new drivers. As well as the use of the vehicle (business, pleasure, etc)

So, the number 1 factor in the rate has nothing to do with the car.

Do you feel safe to just go out and buy anything now? Take a second look! I have a few things for you to consider first:

All things being equal above, this is how the car choice will drive insurance rates upward or downward:

1. Parts - Accidents involve repairs. Therefore, if the make of the car has higher than average costs on parts and/or labor, this is going to be factored into the insurance rate. 

2. Parts- Again : Often times vehicles that are extremely popular - one unusual example I can give, were certain mini vans, at one time they had high theft rates. Why? As I understand it, it wasn't just because they were reliable vehicles, and it certainly wasn't because they were flashy. It was because of the parts. They were so popular, that parts were in high demand, so believe it or not, they became very expensive to insure compared to other less risky vehicles in the same class. Traditionally, this can effect the theft and collision portions of the premium.

3. Theft Rate - For some insight, you can check out the IBC's Top Ten Stolen Car list or see if your insurance provider can refer you to a similar list in your area or country. If the new car you want to buy is on there, you may have some added cost. This is used as a factor in determining the price of insurance. Obviously the greater the risk, the more the insurance will cost. Now with brand new cars and models, the nsurance companies don't always have the exact data on what the experience will be with the car, so they use the data they have at hand to try and determine the appropriate rates. As an example, here is the 2011 list for most stolen vehicles in Canada from the IBC:

  1. 2009 Toyota Venza 4-door
  2. 1999 Honda Civic SiR 2-door
  3. 2000 Honda Civic SiR 2-door
  4. 2006 Ford F350 Pickup Truck 4WD
  5. 2002 Cadillac Escalade EXT 4-door AWD 
  6. 2006 Chevrolet TrailBlazer SS 4-door 4WD
  7. 2007 Ford F350 Pickup Truck 4WD
  8. 2001 Pontiac Aztek 4-door AWD 
  9. 1998 Acura Integra 2-door
  10. 1999 Acura Integra 2-door

If you check out the list from year to year from the IBC, you will notice some vehicles always make the list. So when you compare insurance rates, you can bet the makes and models with the highest theft rates, even though they may not seem obvious to you, will have higher rates of insurance on the theft portion of the premium.

4. Power & Interiors - Although you may not think it would affect insurance, the power of the vehicle can cause additional concerns in risk when we look at liability. A more powerful car, can do more damage, travels faster (in general) .  Add to that , the fact that often these are higher end vehicles, the combination can cost more. Usually a 4cyl model will be less to insure than the 6. The interior finishing of your car will not usually boost insurance rates on the same model, but if the model changes with the interior - this will be factored into the rates as well. This can affect the Liability, Collision and Theft (comprehensive) sections of the premium.

5. Modified Vehicles - Including upgraded stereos, bodywork (for racing/style), or power alterations (Usually after market)

Watch out because this is where things get tricky.

Before you start to plan on purchasing a vehicle and making all kinds of modifications to it, ask your insurer, agent or broker. Some modifications are not problem at all, while others move you into a category of specialized markets. Stereos can easily be added for a very small cost, but ahouls always be mentioned when purchasing the insurance.

Other modifications to the suspension, body or fuel sources - even vehicles with steering on the right side instead of the left, can be huge issues. So call those in first! Sometimes a broker can have access to a specialized market for these vehicles, but not every insurance company does.

6. Antique or Collector cars & Amphibian Vehicles


Jay Leno driving up to the Emmy rehearsal 1993...Jay Leno driving up to the Emmy rehearsal 1993 in one of his antique cars, a Hispano-Suiza 8 (Photo credit: Wikipedia)

You may not be Jay Leno, but you may have a similar passion for antique cars! There's good news - the car may be expensive, but the insurance doesn't have to be. There are lots of options for Antique cars, and in this category, in our experience we can find excellent rates on insurance - and so should you, because the vehicles are not driven much and are usually very well protected and cared for. Make sure you check for a specialized insurance company. For example, the ones we use charge much less than our regular insurers, because they specialize in the antique market. There are also additional considerations that the specialized markets may offer that are more advantageous than regular insurers, like making sure the coverage you get is agreed value and not cash value. You have to know where to insure these special vehicles to get the best price and coverage.


Same with Amphibian Vehicles

7. Different insurers have different "appetitie's" for cars. As is the case with Antique cars, and Amphibian Vehicles. For example, if we take the same client profile, and plug in a Porsche, we actually have markets who come in at half the price because for whatever reason, they aren't as scared by the Porsche. On the flip side, we have markets who are way to high on that vehicle. We know this as brokers, based on our experiences - so keep this in mind when you check around. Different insurers really do have different appetite's, they do not all use the same rule book!

8. Anti theft Requirements. Find out if the vehicle you are purchasing requires special anti theft devices or engraving. Many dealers will suggest you do this, suggesting it will give you a big discount on insurance. Call your insurance first and find out if you need the anti theft, sometimes it is a requirement. Keep in mind point #7 above, the requirement may not be the same with all companies! Secondly, if it's the discount you're after, find out how much that is. Sometimes the discounts are a mere $75 a year, other times they can add up to a couple of hundred dollars.

Tracking devices can be fantastic , but may involve additional costs to you like monthly fees, other anti theft choices like engraving, have one time costs. Your insurance representative may be able to help you out in this regard. Check before you decide to install anything, and find out what it will really do for you.


The best way to protect yourself from higher rates is to do a little research on insurance with your broker or agent, before you sign the papers. If your agent or insurer does not have access to several insurance companies (one of the benefits of dealing with a broker), then you should definitely call another insurer to compare.

Have the exact model you are looking at ready, to make sure that you've got the right quote. As mentioned in point 4 above, a 4cyl vs a 6 or 8 cyl - or the sport model with that incredible sliding roof, may all be different.

Build Your Dreams - Insurance based on relationships - Ogilvy Insurance Westmount by Mila Araujo @MilaspageNever be afraid to call or email and ask. It just may help make your decision easier, and that's what your insurance adviser is there for! Anything is possible when you have access to many insurance companies and markets, you want to make sure that you have all the information to make an informed decision on your next purchase. Don't forget the insurance!

Oh, and the color?  Well, check this with your personal advisor first, but in experience,  we have yet to see an insurance application that asks for color, so be happy, and get the one you love!

 So, are you ready for your new car? What have your experiences been?


Related Posts:
Why did my car insurance increase this year? How can I save money?
The Deductible - Saving Money on Insurance
Is being with the wrong insurance company costing you money? Find out what companies will give you for free.
Canadian Grand Prix Formula 1 in Montreal, We Love Fast Cars.
Enhanced by Zemanta

The Connection Between Social Media and Insurance : Five Questions

I was honored to be interviewed recently by ILSTV, "the source for daily insurance news and analysis and information relevant to the Canadian insurance industry" on my views and experiences in using social media as an insurance professional to support our clients, get involved and help give back to the community, as well as to listen to what people are thinking about. Every opportunity to listen to our clients and learn from them is an opportunity for us in the industry to provide better services and support.

The Financial services industry is one of the most complicated for individuals to understand, which is why I feel it is so important for "experts" and experienced brokers to reach out to their clients in as many ways possible and provide them with resources to learn about the things that affect them. Social Media provides an incredible opportunity here. It was very nice to have the chance to chat with Julie Hawrishok of ILSTV and answer her five questions, in fact we covered so much,  I even got a bonus one (Thanks Julie)!  Read more on our conversation in this interview:

"With more than* 15 years of experience in the insurance industry, Mila’s now embraced social media and has become a strong advocate for social media in the

Continue reading "The Connection Between Social Media and Insurance : Five Questions" »

To claim or not to claim: Torrential Rains Sweep the Montreal Region Causing Massive Sewer Back Up & Water Damage

Send to Kindle

Water Damage claims poured  following a flash rain storm which caused chaos in the streets and homes in the Montreal Area. The West Island and South Shore regions were the hardest hit as people had to wade through water on what are normally clear streets. Cars drove through rivers, and low lying areas were hit hard as masses of water poured down the hills in areas like lower Westmount.

Aviva Canada issued an announcement advising that they had called in their Catastrophe teams to respond as people discovered their basements flooded as the result of the afternoon downpour.

When do you make a claim?

Continue reading "To claim or not to claim: Torrential Rains Sweep the Montreal Region Causing Massive Sewer Back Up & Water Damage" »

Montreal, Where Pot Holes Have a Home - Your Comprehensive Guide

<script type="text/javascript" src=""></script>
<script type="text/javascript">(function k(){window.$SendToKindle&&window.$SendToKindle.Widget?$SendToKindle.Widget.init({}):setTimeout(k,500);})();</script><div style="display:inline-block;padding:3px;cursor:pointer;font-size:18px;font-family:Arial;white-space:nowrap;line-height:1;border-radius:3px;border:#ccc thin solid;color:black;background:transparent url('') repeat-x;background-size:contain;"><img style="vertical-align:middle;margin:0;padding:0;border:none;" src="" /><span style="vertical-align:middle;margin-left:3px;">Send to Kindle</span></div>Montreal is a beautiful city, it captures many of the most desirable qualities of any city on the planet, from a rich cultural diversity to our festivals or the way we honor and celebrate nature in our green spaces and outdoor activities. According to Tourisme Montreal's latest report, Montreal received approximately 7.5 million tourists/visitors from abroad, representing 2.3 billion dollars in revenue.

This is without a doubt a spectacular city to visit and if you have not been here, then make some plans, because you are sure to have an amazing stay!  According to Wikipedia it's our French heritage that sets our beautiful city aside from many other North American tourist destinations. We have so many wonderful qualities as a city - if you want to know some awesome details that make Montreal a wonderful place to visit and live, you can check out this post.

There is however one thing that Montreal is known for that is not as appealing, and that's our outrageous pot holes! Every spring, as we prepare for the numerous festivals and international events, like the Jazz Festival, the Grand Prix, and hundreds of other events (including the #140confMTL - sponsored by Ogilvy & Ogilvy) the attention of the city gets distracted as we dodge obstacles in our daily lives - the Pot Holes!

Pot Holes in Montreal A beautiful City with a few road hazards from the Montreal Gazette


Continue reading "Montreal, Where Pot Holes Have a Home - Your Comprehensive Guide" »

Insurance and Hockey? You need the right members on the team to win! Broker Values

Send to Kindle

I saw an interesting question in one of my LinkedIn groups, it revolved around where the focus is for an insurance representative.

We have so many priorities these days, focus and motivation are what drive us. Without reading further, if you had to answer right away, do you think the person who handles your insurance represents your best interests or always finds you the best price they can... or do you think they are just looking out for themselves?

Buffalo Sabres Game vs Canadiens  Down the Ice
If you think insurance "people" are just out for themselves, you wouldn't be alone! The reality is, if you look at the "game" of insurance, there are lots of players. You don't want to be alone, you want to be part of a team, and you want someone to be watching your back - protecting the goal. Above all, you need to trust them.

If you don't feel that way, you need to ask yourself, are you dealing with the right person? You have options.

Continue reading "Insurance and Hockey? You need the right members on the team to win! Broker Values" »

Let's talk about Rot and Mold - Is it Insurance to the rescue or are you out of luck?

One of the most difficult things we face as brokers is when a client calls us for help with a situation or perceived emergency, and we have to tell them something is not covered.

In life, we all like to know that someone has our back. When something goes wrong there's someone there to help us. 

Your insurance policy becomes that "someone" when something sudden and accidental happens to your home, car or other insured property. 

When you deal with a broker, the expectation to have someone who will be responsive and help is even higher. You are not only dealing with an insurance company, you're dealing with a trusted advisor, someone who has the experience to know how to help you when you have an emergency. Unfortunately, in some cases,  like when dealing with rot or mold, or the natural deterioration that takes place over time,  even your insurance will not respond.

You call your representative, you've suddenly become aware of a horrible problem - mold in the walls, or rot under the think you will have some support - but brokers aren't miracle workers. All we can do is advise you what your policy covers. In any policy that I know of, rot and mold is not covered.


Rot and Mold fall under exclusions in your policy wording.

There are references in most insurance contracts to items that are not insured.  The nature of insurance is to protect you from sudden and accidental loss. If you think about the length of time it takes for rot and mold to take hold, neither of these things are sudden and although they may result from an accident, in the majority of cases, with few exceptions, they result from unattended repair over time.  Most policies contain an exclusion that reads somewhat like this:

"We do not insure water damage caused by continuous or repeated discharge or overflow of water whether the insured was aware of such discharge or not"


"We do not insure gradual damage caused by wear and tear, gradual deterioration, rust, corrosion, dampness, wet or dry rot, fungi or spores OR repeated damage to property."

It's a tall list of things that can go wrong and not be covered, but these are all important considerations for any homeowner. (Note that this is but two areas of a long list of exclusions on all homeowner policies - it is important to find out what your contract lists specifically).

What can you do to protect yourself?

Example of a stain appearing on a floor - indicative of rot.You need to start keeping your eyes open for the subtle, and sometimes not so subtle signs of trouble.

In every case I have ever handled where we see instances of  Rot and Mold, two things happen.

1. The homeowner is shocked and distressed, suddenly hit with overwhelming cost, and the surprise that its not insurable. They can not believe the level of damage hidden in the walls or floors. They usually don't feel they had any indication of the nature of the problem.



Under the floor boards2. We usually send people in to investigate the loss - its part of the process in making a claim.  When we look at pictures taken during this investigation, we usually clearly see the signs were there. Rot 2 Yet individuals did not ever notice them. I think it is because in the busy lives we lead, we just don't have the time to focus in on these things, we hear a drip, we don't imagine its destroying our outer walls, or our floors. We just think it's a drip. We, as individuals need to start paying closer attention.



What can you do?

It's all in the details, become aware of what is going on in your home. Realize that anything out of the ordinary can point to something serious. Stop things in their tracks while they are still small problems. You never know what is lurking underneath the surface.


Some water damage advice to help control or prevent rot or mold:

  • If an area is damp, make sure you install proper ventilation. Try and determine why the area is damp, think about the effects that continuous dampness could have and be proactive. Money is tight everywhere, no one wants to take on added expense, but in reality the long term effects of not responding to situations like these are far costlier on all levels and also can put your health and safety at risk. Monitor the humidity levels in your home, between 30% and 50% is a fair range.
  • When materials in your home start to change color, or wood or paint start to buckle - this is not just something that's happening for no reason. Water is often the cause.
  •  If you have water damage, attend to fixing the source of the problem quickly.  According to the Insurance Bureau of Canada, some types of mold can grow in as little as 24 hours.
  • If you see damage somewhere that doesn't seem to be remotely associated with a source of water - don't disregard this - be concerned.  Investigate what is happening before damage starts to spread. If you catch something right away, it might be covered by your insurance because it will never get to the point of being repeated, or gradual. Seek professional advice.
  • When you are purchasing a new home, make sure that you hire a qualified and experienced building inspector to take humidity tests of the walls at the property. We have seen several cases first hand where inspectors simply did not investigate far enough and people who have purchased new homes end up with massive reconstructions due to hidden rot and mold issues. This is the worst kind of case, when the person affected wasn't even in a position to know about the issues, and yet they get stuck with the bill.  I have a client right now who is one year into the repair work and paying thousands of dollars in insurance simply because they did not detect the problem prior to purchase. Their inspector let them down, but they are the ones stuck with the bill. Invest in a thorough home inspection, I can not tell you enough how important it is to uncover things before you make your purchase.

This is the best we can do for you as brokers on this issue: offer you advice, explain what your policy covers or excludes and try and help you be proactive in prevention. Anything beyond that is outside our mandate and ability. 

When there is an injustice on the insurance company's side - we will go to bat for you. If you need help settling a claim, and you need someone on your side - that's what we are here for. We do what we can within the limits of coverage of the insurance contract. Unfortunately, on the issue of things that are not covered even with the best broker, you will not be able to receive coverage for something that is excluded from the contract.

Working together to be proactive, that's the best advice we can give. With water damages on the rise, I am sure we have all heard of issues, what has your experience been?

What about those of you who have had a claim denied, did you think your broker let you down when they had to explain the insurer denying a claim?








Send to Kindle