There’s nothing like your home. It’s where you spend a lot of your time. It’s an investment. It’s your place of refuge. In Alberta, your home also shelters us from the outside elements: wind, rain, cold, snow, and everything else our tumultuous weather has to offer. Our homes are also one of our most valuable assets – they can be expensive to repair or replace. It makes sense to protect our homes with insurance.
Alberta home insurance provides financial help in the event of a catastrophe or an unexpected event. Unfortunately, many people don’t understand how this type of insurance works and opt for the cheapest Alberta home insurance rates they can find. This can leave them frustrated when disaster strikes and they may not have the best coverage. Here’s what impacts Alberta home insurance rates and why they fluctuate:
Alberta home insurance rates are heavily influenced by your insurance and claims history. First of all, how long have you been consistently insured? The longer you have insurance, the better you look to insurance companies. Second, have you always paid your insurance on time or had any issues with insurers? They’ll know if you’ve missed payments or switched around mid-term. This makes you look like a less desirable client and can increase your rates. Third, the number of claims you’ve made has a significant impact on your home insurance premiums. The fewer claims you’ve had, the cheaper your rates. Some insurance companies even offer discounts for remaining claims-free for a certain number of years.
You can give insurance companies permission to check your credit rating for a discount. This provides proof that you pay your bills on time and will likely pay your insurance. Not all insurance companies offer this perk, but you can ask your broker if this is available to you.
Your address determines your location, which impacts a number of factors in your Alberta home insurance premiums:
The farther you are from fire services, the more likely your home is to be severely damaged by fire. The frequency and severity of natural disasters also impacts your rates as it means you’re more likely to make a claim. Alberta holds several of the most expensive events in history due to flooding, wildfire, and hailstorms. This makes it more expensive to insure a home in Alberta, especially if you live in an area with a high flood, wildfire, or hail risk.
The crime and claim rate of your neighbourhood also impact your home insurance rates in Alberta, as it helps determine how likely you are to make a claim or be a victim of theft. Higher crime areas tend to be more expensive to insure. Your neighbourhood claim rates will depend on a number of factors from income to the age and building types of homes in your area to how often you experience severe weather.
Obviously, if you live near a river, you are more at risk for events like flooding. Some insurance companies may increase your rates or simply not offer certain types of coverage.
The older your home, the more likely it may have problems due to wear and tear over time. The type of building and what it’s made of can also impact your home insurance rates in Alberta. For example, a wood-build with regular siding will likely be more expensive to insure than its neighbour that’s concrete or stucco since the wood-build is more likely to be severely damaged by fire or hail.
Your roof is critical to protecting your home from an element. The older it is, the more likely it will fail or be damaged. Generally, it’s recommended to replace your roof every 15 to 30 years, although it depends on the roofing materials you’ve chosen. Repairs may also be required.
Some insurers will raise your premiums or reduce coverage if your roof is over a certain age.
Your home’s plumbing, electrical, heating and other systems all impact your home insurance rates. Certain types of systems are more likely to cause damage. For example, knob and tube wiring (generally used before the 1940s) has a higher fire risk. Wood-burning stoves also have a higher fire risk and will make your home more expensive to insure.
How much would it cost to rebuild your home? How much would it cost to replace all of your belongings? These costs factor into your home insurance prices in Alberta. This includes the labour and material costs, as well as replacing appliances, furniture, and your other personal belongings. It can also include debris removal and, if you have the coverage, upgrading your home to current bylaws.
Keep in mind that the purchase price and market value are not the same as the replacement cost. Your home’s purchase price could be far lower or higher than the expense to rebuild it.
Of course, your Alberta home insurance rates are also influenced by what you choose in regards to protecting your home. This includes your deductible, policy limits, and coverage options.
Your deductible is the amount you’ll pay if you have a covered claim. The lower this amount, the higher your home insurance premiums. For example, if you have a deductible of $500, you’d pay higher home insurance rates than if you choose a deductible of $1500.
Policy limits are the maximum amount that will be paid out in the event of a claim. There are usually multiple policy limits for different aspects of your home insurance and some insurers have an overall limit as well. For example, you could have a $50,000 contents limit to protect your personal belongings, a $400,000 structural limit to rebuild your home, and $6500 additional living expenses limit. If your house burnt down and was covered by your insurance, that means you’d have up to $400,000 to rebuild the structure of your home, $50,000 to replace your belongings, and $6500 to help cover your additional costs of living away from your home while it’s rebuilt.
Finally, you have your coverage options. The more extensive your coverage, the more expensive your home insurance will be. An insurance broker can help explain your coverage options and determine which ones are necessary and fit your budget.
Home-sharing is an alternative to hotels that allows visitors to a city to stay in a privately-owned room, apartment, or home. This phenomenon has exploded in popularity across the globe as an affordable alternative for travellers. Plus, homeowners can make some side income from their property. Home sharing isn’t without its risks, however – it was a nightmare for one Calgary family when they agreed to rent out their home for a group attending a wedding. Once the Calgary family returned home, they discovered their house in ruins. The group staying as guests in the home had caused roughly $150,000 in damages. Unluckily for this couple, home-sharing insurance was not yet offered in Canada.
While home-sharing can be a great idea and doesn’t usually go this wrong, it’s a good idea to be prepared for what happens if it does. For example, do you know if damage caused during home-sharing would be covered by home insurance? We’ll break down the impact of home-sharing on your insurance as well as your options for protecting yourself.
Your coverage may depend on your individual policy and your insurer. Generally, since you’re generating an income through home-sharing, your home insurance will not cover you.
However, more and more insurance companies do offer a special add-on coverage (“endorsement,” in insurance lingo) that will help protect you if you participate in home-sharing. There are often a few conditions, such as:
The conditions may change depending on the insurance company.
The “Host Guarantee” from Airbnb is “designed to protect hosts in the rare instance of property damage to their possessions by a guest staying in the space. The Host Guarantee is not insurance and doesn’t replace your homeowner’s or renter’s insurance.” Therefore, only direct damage induced by a guest is covered by this policy. This means no liability, no damages to cash or pets, and no theft compensation. There is also Host Protection Insurance in a situation where a guest is injured on your property during their stay which covers up to $1,000,000 in liability. Other liability cases are not covered.
Other home-sharing companies offer similar insurance coverage to Air BnB, but it’s important to read the full terms and conditions to see exactly what’s covered. Every company is different.
While you’ll hopefully never need to use this coverage, there is the potential for a lot to go wrong with home-sharing: theft, damage, harm caused to your pets, someone getting hurt, getting sued and more. These are all costs you may have to cover out of pocket. Ensuring you’re protected with the home-sharing platform coverage and personal or commercial insurance will help reduce the financial burden on you if the worst happens.
Your premiums for this additional protection depends on how frequently you plan to have guests. Generally, you are only covered if you home-share through an approved third-party home-sharing service such as Air BnB.
If you plan on participating in home-sharing more than 60 to 180 days per year or have purchased a property exclusively for home-sharing, you should look into landlord or rental property insurance. This can provide comprehensive coverage for a home that you are planning on home-sharing long-term, including property damage and liability. This may help reduce the costs of paying to rebuild or repair the home and replacing furniture and other items owned by you. It can also help cover your legal expenses should you be sued by a guest. Many policies also include fair rental value, which can provide you with some financial help if you lose rental income during a covered loss.
Your insurance broker is an excellent resource if you plan on home-sharing: talk to them about your plans and they’ll help you review your insurance options.
Opening up your home to temporary guests can be daunting. While most people will be great temporary tenants, there’s always the possibility of an accident or a bad guest. Here are some tips to help you protect yourself while home-sharing:
With any luck, you’ll have great guests and never need to worry about damage or someone getting injured. But accidents happen – and so do bad guests. Protect yourself and your home with the proper insurance coverage to reduce the impact on you should the worst happen. Talk to your insurance broker today to find out more.
Imagine a situation where you’re out to a fancy dinner in Canmore to celebrate an important milestone. Near the end of the dinner, you get a frantic call from a neighbour. Your home is on fire! Thanks to Calgary’s great fire fighting services, only your kitchen has significant fire damage. However, there is still smoke and water damage to other areas of your home.
It would be quite a shock, but luckily an adequate home insurance policy will cover most of the costs. You would be compensated for the clean-up, tear-down, and reconstruction of the damaged areas as well as for the replacement of your belongings. You’d also receive some help with additional living expenses if you needed to vacate your home during this process. However, the one thing you may not be covered for is the costs to conform to the updated bylaws of the city. This can be a huge expense depending on when your home was built and should be a concern for all homeowners, as municipal regulations are always changing. For example, if your home had been built 50 years ago, there would be a lot of updates you would be required to comply to – and these upgrades wouldn’t be covered by your home insurance.
Bylaws and home insurance aren’t often thought of together, but it’s important you consider the impact of municipal regulations on your home insurance and finances in the event a catastrophe occurs. While the expectation is that bylaws would be covered in your home insurance, the reality is that they’re often not included in standard coverage.
Bylaws are difficult because they are constantly changing. These changes are necessary to help protect lives and infrastructure, however, they can be a nightmare to deal with when you’re rebuilding a home after an insured claim. That’s because most standard home insurance policies agree to rebuild your home nearly exactly like it was. However, this is sometimes impossible as bylaws have changed to prohibit certain designs or materials.
For example, if an Edmonton home that was built 30 years ago were to be rebuilt after an insured loss, the reconstructed property would need alterations to comply with the current municipal bylaws. Say, hypothetically, it was now regulation for all homes to install a sprinkler system. These can be up to $2,500 or more. Since this was not a part of the home which was destroyed in the first place, your insurer probably won’t compensate you for this additional cost. Generally, if a property is over a decade old it no longer meets the requirements of the present public regulations.
Basically, bylaws increase your home’s replacement cost. However, these changes are not covered as it was not originally part of your home as per your insurance contract.
There are two exceptions where bylaws wouldn’t impact your insurance coverage:
In the first case, your insurer does not require you to rebuild your house as-is. Instead, your insured claim is paid out based on your settlement option and your policy limits. As the insurance company isn’t rebuilding the house, you’re free to construct the building you want. Of course, you’d still have to follow the bylaws, but you could alter your rebuild to be within your budget.
In the second case, you have an endorsement or add-on coverage that would cover the cost of updating to current bylaws. So, if you had an insured loss and needed to rebuild your home, the difference in costs to be compliant to municipal regulations would be covered. Otherwise, you’d be on the hook.
Some insurers are now including bylaw coverage in some of their comprehensive home insurance packages. Check with your broker to see if bylaws are covered.
In order to protect yourself, you should discuss your options for covering bylaw update expenses with your independent insurance broker. Insurers and policies differ from company to company; some companies will include this coverage, where a lot of others will request that you add it to your policy.
Factors affecting home insurance rates include those that determine the likelihood of damage to your home and the cost to repair or replace your home. Some of these factors are manageable by you but others are entirely out of your control. Unfortunately, many people don’t know what factors affect home insurance premiums and this results in a lot of frustration when there is an increase in their insurance bill. This is especially true if they’ve been claim-free for years. So what affects your home insurance rates? First, we’ll look at what individual factors are affecting your home insurance rates and then we’ll review the ones you have no control over.
These factors can affect your home insurance rates positively or negatively. For example, if your home is older, it may cost more to insure as the wiring or plumbing may be more likely to fail and cause damage. On the other hand, an upgrade could increase the cost of replacement for your home. It’s a complicated formula, that’s for sure.
While you can control some factors affecting your home insurance rates, others are out of your hands (unless you move).
Alberta has experienced a string of natural disasters over the last few years and these are likely reflected in your latest home insurance renewal. Between the 2016 Fort McMurray fires and the 2013 floods across the southern areas of the province, Alberta experienced a blow of $14 billion dollars in damages. The frequency of these natural disasters impacts your insurance rates, as the more at risk your location is for such events, the more expensive insurance will be. With the number and severity of these natural disasters increasing, it is likely that insurance costs will continue to rise.
Insurance fraud occurs when a home insurance policy owner deliberately makes a claim that is exaggerated or misleading. A few situations that would count as fraud include:
An increase in the frequency of fraud has put a considerable amount of pressure on insurance companies and prompted an increase in rates.
The cost to repair your home is tied in with labour and material costs. Unfortunately, these follow the cycle of supply and demand which means they can fluctuate. If your area has been hit with a natural disaster, your insurance company could be paying much higher costs than if your home was the only one damaged by a fire.
We know that when you make a lot of claims, your insurance premiums may be higher as a result. On the other hand, should you be claims free or have very few claims you will likely have a lower rate. But this also applies to people living in your area. If there are a lot of claims for weather-related damage or theft, your insurer will probably interpret this as meaning your area is higher risk and will potentially increase your premiums.
Where your home is located is a key factor affecting home insurance rates. Proximity to risks such as rivers and cliffs will may your home more expensive to insure.
Your home’s age determines many of its risk factors. An older home often has wear and tear, which can increase its chance of damage. It also often has outdated plumbing or electrical systems. Upgrades can help reduce insurance costs and make your home more efficient and safer to live in. Talk to your broker about your options if you have an older home.
The farther your home is from a fire station or fire hydrant, the higher your insurance premiums will be. That’s because when it comes to fire, time is of the essence. If a fire station is nearby, crews can get to your home quickly. If there’s a fire hydrant, they’ll have the resources to fight the flames. If they take a while to get to you or don’t have access to water, their ability to save your home is impaired.
If you have any questions about factors affecting home insurance rates, your insurance broker can help. They can also help you save money on your home insurance premiums and get the best coverage for your needs at a competitive price.
Home insurance is for anyone who is interested in financial security, peace of mind, and safeguarding their home and belongings. It’s also required by many mortgage lenders. Home insurance covers many different scenarios and causes of damage but the extent of your coverage depends on your insurance company and your coverage options. As a homeowner, you should be aware of what is and what isn’t covered by your home insurance. Even the most comprehensive coverage may require separate endorsements (add-ons) to protect you from certain perils like earthquakes and water damage. Common scenarios not covered by basic home insurance include:
While some of these perils can be protected against with an endorsement (add-on coverage) some of these scenarios are not covered by most home insurance companies. Why aren’t these covered? They’re usually prevented by good home maintenance or they are considered too risky for the insurance companies. We’ll review each of these items in detail to help you understand your home insurance a little better.
Water damage is not generally covered under your typical basic home insurance policy, although some insurers are offering this as part of a comprehensive home insurance package. Most insurance companies offer flood insurance as an endorsement or add-on coverage. This optional supplementary insurance extends your protection to include overland water and sewer back up damage. This includes water damaged caused by bodies of water overflowing, rainfall, snowmelt, and backup of liquid from your drains into your home. Sewer backup coverage can often be purchased separately without the overland water portion, too.
It’s important to note that “flooding” damages caused by something like a burst pipe or malfunctioning washing machine may be covered by your normal home insurance policy. Other sources of water damage, such as a tsunami or seepage from groundwater, may not be covered at all. Exactly what’s covered will vary by the insurance company, so be sure to talk to your broker to understand your home insurance coverage.
Any damages caused to your home which can be written off as wear and tear will not be covered by your home insurance policy. This is because your coverage is intended to safeguard your house from sudden catastrophic losses such as fires and major storm damage. You, as the homeowner, are held responsible for performing rudimentary upkeep to protect your home.
Like with wear and tear, you as the homeowner are held accountable for the general maintenance of your home. Mould typically results from negligence following water damage or a home that wasn’t properly repaired afterwards. As mould is preventable and slow-moving, you are expected to notice and repair it. Proper restoration after water damage is critical!
In a situation where armed municipal, provincial or national officers or the army needed to breach your home, your insurance policy will not compensate you for any damages incurred. This is because any perils caused by a public authority is not generally included in your coverage. You may also not be reimbursed if any authorities had to seize your personal belongings, take over your land or commandeer your home.
Whether it is bedbugs, termites, mice or any other sort of vermin, you will most likely not be reimbursed for the damages caused by the infestation of these creatures. Technically, infestations are made worse by a buildup over time, and most insurance companies consider the removal of vermin and upkeep of your home a part of general maintenance.
Should you live near a nuclear power plant, your home insurance is fairly likely not to extend to any damages induced by a nuclear accident. Unfortunately, most insurers do not offer add-on coverage that will extend your protection to this kind of incident. Nuclear power plant companies are often obligated to supply liability insurance in order to compensate for damages as long as you live within the area of risk.
Any damages induced by the shifting of the earth underneath your home are not usually covered by your home insurance policy. This includes earthquakes, sinkholes and mudflows. However, there are additional coverage options that will cover this kind of damage. This only refers to damages directly caused by the earthquake itself, and earthquake insurance often has a higher deductible than regular insurance. Nevertheless, it is recommended that homeowners who live in earthquake-prone areas have this coverage in case of an incident.
Dog bites comprise over one-third of home insurance liability claims, so it may not be a surprise to learn that not every dog breed is covered by your typical home insurance policy. Breeds which are known for having aggressive tendencies or have been otherwise branded as dangerous may be left out of a policy. Some insurance companies might request additional information about your pet to assess whether or not there is a history of aggression or a higher risk of a dog attack. Your broker will be able to determine whether or not your dog’s breed affects your insurance – this isn’t the case for all insurers!
Understanding your policy will help set you up for financial security and peace of mind when it comes to protecting your home. Knowing what your policy does and doesn’t cover is critical. Your broker is an excellent resource for all of your questions and to help you interpret all of the insurance lingo. Contact us today with your questions!
Wildfires are a frequent occurrence in summer throughout Canada, but some years can be far more devastating than others. There are some 8,000 wildfires that affect heavily forested areas in the country per year; both drought and dry conditions only increase the risk for potential fire activity, which is more frequent than ever in the summer months.
Alberta has experienced a string of destructive wildfires in recent years. In 2016, there was the Fort McMurray fire which engulfed roughly 590,000 hectares of land before it was deemed to be controlled. 2019 suffered a rough start to summer in Alberta when the Chuckegg Creek Fire started near a town called High Level, forcing thousands of residents to evacuate from their homes.
Wildfire smoke poses a huge and sometimes underestimated threat to the health of everyone in the province due to the large amount of land it can quickly encompass. Both Alberta and British Columbia have suffered some of the worst air quality conditions in recent years than ever thanks to wildfires.
How Wildfire Affects Your Health
While certain individuals are more susceptible to the effects of wildfire smoke than others, the threat is no less universal. Those who suffer from chronic respiratory conditions such as asthma, lung or heart diseases are particularly sensitive, as well as people over sixty-five, smokers, infants or young children and pregnant women. Anyone who is at risk from wildfire smoke should seek medical care if they are experiencing any of the following symptoms:
Those with heart or lung conditions should ensure they have access to the appropriate, necessary care if there is any exposure to smoke. Wildfire smoke is particularly dangerous because it includes both carbon monoxide gasses and particles of building material and burning vegetation, and can cause issues or exacerbate pre-existing conditions when it enters the respiratory system.
Limiting Smoke Exposure
The best way to avoid being affected by wildfire smoke is to limit your exposure to it altogether. Here are a few ways to do so:
If you need to go anywhere, reduce your exposure to the smoke by sealing your windows in your car and using your air conditioning to circulate the air.
What is particulate matter?
Particulate matter is debris that was burnt by the wildfire which accumulates in smoke. It is what makes wildfire smoke so dangerous. The largest particles, greater than 10 micrometers, tend to aggravate the eyes, nose and throat. Particles smaller than 2.5 micrometers may possibly be inhaled into the lungs and induce symptoms like coughing – or even worsen pre-existing conditions.
What do I do if I’m having a medical emergency due to smoke exposure?
Call 911 immediately, or go to an emergency room if you can. Medical emergencies from smoke can include severe difficulties breathing or intense chest pain.
How do I know what the air quality is in my community?
Check the Air Quality Health Index for Alberta.
Protecting Your Home from Wildfire Damage
Wildfires expand by using vegetation and wilderness as their fuel source. When they cross into urban communities, manufactured structures become their source of fuel. Protecting your home is essentially about making it so that your home cannot be used as a fire fuel source. Here’s how:
For additional information regarding current provincial advisories for wildfires and other public health concerns, check Alberta Health Services. They will be able to provide further assistance when it comes to protecting yourself and your loved ones from the effects of wildfire smoke.
Whether you’re an established home buyer or you’re looking to enter the real estate market for the first time, leaving some room in your budget for home insurance is key.
The good news is, our insurance experts have compiled 10 ways that can help you save on your home insurance. Check out the list below, then contact your Sharp Insurance broker to see if you can take advantage of one (or all) of these discounts.
Insurance companies want your business, and they want you to consolidate all of your insurance needs in one place, on one policy. The good news is that by bundling your home, tenants or condo insurance with your other insurance needs like your car insurance, you could save up to 20%.
As an added benefit, your insurance becomes simplified with one premium, one renewal date, and in the event of an incident involving your home and car, you only pay one deductible.
There is lots of choice when it comes to direct writers and insurance brokers in the market today. That’s why at Sharp, we guarantee we can save you money on your insurance. On your next renewal, bring your policy to Sharp and we will beat your current premium price by up to 5% – guaranteed. Some conditions apply. Policy must be within participating markets. To learn more or get a quote, contact us today.
Newer homes, that are roughly ten years or younger, are more likely to have updated roofs, electrical and plumbing – making them less likely to have a claim. Many also come with sprinkler systems or water damage prevention devices. If you’re in a newer property, ask your Sharp Insurance broker if you are eligible for discounts.
Another thing insurance companies will look at when determining your premium is the location of your property. They will often ask how many meters or kms to the nearest fire station or fire hydrant. Being near emergency services is more likely to save you money on your home insurance. On the flip side, if you are looking at a property close to the river or areas that are prone to flooding, don’t anticipate saving any money on your premium, as you’re at a higher risk of making a water damage claim.
Whether you’re buying a new home or simply giving your current property some much needed renovations, it’s important to let your broker know. Certain renovations and upgrades can save you money on your home insurance. These include:
Many of the insurance companies we work with will offer discounts if you pay your premium annually in one lump sum, as opposed to paying your premium monthly. You could save up to 4% by paying your premium annually. Talk to your Sharp Insurance broker to determine if this is right for you.
BONUS TIP: Some insurance companies will also offer a discount to homeowners that are mortgage free.
By installing devices that protect your home, belongings and loved ones you are not only more prepared in the event of a break-in or fire, but you may qualify for savings on your home insurance.
Houses alarms, sprinkler systems, carbon monoxide detectors and fire extinguishers are all great additions to help keep your home happy and safe. Talk to your Sharp Insurance broker about how they could help you save up to 20% on your premium.
Your credit score measures your financial health. More than half of Canadian insurance companies utilize your credit score as a way of calculating the likelihood of you making a claim. If you have good credit, you could be rewarded with preferred pricing on your policy.
If you have made several claims in the past it could show that there are underlying issues with your home, or that you live in an area more likely to result in a claim. The longer you maintain a claims free status, the less risk you present to the insurance company. Many insurance companies will offer discounts on your home insurance when you have been claims free for several years.
At Sharp, we’re not like the other guys. Since we’re not owned by an insurance company you know that we are working to find the policy that meets your needs at a great price. Great coverage, a low price, unbiased advice – what more can you ask for? Talk to a Sharp Insurance broker and start your home insurance quote today.
BONUS TIP: By increasing your deductible you can save on your annual premium. Did you know that many companies will let you place a deductible on specific types of losses – like water or wind and hail. You can choose to increase those deductibles to save money – great thing to do if you are in a higher risk area.