The impacts of a major storm on Home and Car insurance coverage options and premiums in Alberta
Southern Alberta is a hotspot for hailstorms in the spring and summer with Calgary being one of the hardest-hit cities in the region of the province. The destructive hailstorm on June 13, 2020, is a prime example, projected to cost insurance companies upwards of $1 billion. The event could also land on Canada’s Top 5 Weather Disaster list by industry-wide losses. Calgary’s sky-high storm costs compare to Airdrie, Alberta’s ruinous 2014 weather that cost more than $500 million.
As an Albertan, we expect fiery hail and windstorms every year that start in June and run throughout August. But not everyone knows how destructive these events are and how they impact their insurance policies and premiums. What to do, for example, if you’re struck by hail or windstorms regularly.
Consumers and Insurers slammed by a rise in weather event costs in Canada
Hail has pounded every province and territory of Canada over many years; the costs of the severe weather events are on the upswing. The peril has wreaked havoc before this month’s event, but not to the detriment of the last decade, specifically the last few years when hail claims rose substantially.
According to the Institute for Catastrophic Loss Reduction, hail, water, and wind damage cost more than $1.66 billion in insured losses in Alberta for events dated 2010, 2012, and 2014.
There’s no retreat in severe thunderstorms as climate change, and urban density expands the weather’s destruction. So, it’s essential to know how to deal with its impact on your home and vehicles.
How do Hailstorms Impact My Insurance Policy?
If you were one of 20,000 homeowners hit with significant damage to your home’s siding, or roof; or your car was totalled or smashed by Calgary’s recent storm, there are steps you can take to recover your losses.
Sharp Insurance’s broker Daniel Wahba talks about three major areas of interest to help with your hail damage:
- What does hail damage coverage cover for your home?
- Anything that’s banged up by the hail will be covered by your insurance policy. You may be subject to different deductibles based on how your policy is set-up, but you do have coverage in the event that your siding is destroyed, your stucco, your asphalt, shingles, windows. There is coverage for everything.
- What if I take a cash settlement?
- Any time you make a claim, you have the option of taking a cash settlement. A cash settlement can be beneficial for you if you work for a preferred contractor or have a friend who does this type of work. In order to maintain your coverage, you need to get the repairs done, and send proof of completion over to your insurance company. If you hire someone off the street to do the repairs and they don’t provide you with an invoice, there is no way of proving that the repairs were completed. So, it’s okay to take a cash settlement – but make sure you have proof of repairs.
- Will my premium increase after this claim?
- Yes, it’s possible that your premium will increase after you make a hail claim. Every time you make a claim, it’s factored into the renewal the following year. If you haven’t had a claim for an extended period, you may have protection against the claim. That said, if you live in an area that’s prone to claims, you may see an increase based on just living in an area with a high number of claims. Every policy is a little bit different – you may see an increase; you may see a decrease. But, if you haven’t had claims in a very long time, it’s very likely that the claim will be protected.
What are My Next Steps?
It’s always a good idea to reach out to your insurance company or brokerage to see what your insurance policy covers before you schedule any repair work to your home or auto. Your insurance provider may have 24-7 service, so call immediately after you spot dents or dings to either your home or vehicle. If there is a storm, wait until it’s safe to go outside and check your home or car for deterioration.
What Preventative Measures can I Take to Lessen the Impact of a Storm?
Hail and windstorms will put an enormous dent in your wallet if you don’t have the proper insurance coverage. But what can you do to prevent damage before it’s too late?
Our next blog will cover preventative measures to protect your car and home before a storm. Learn tips and tricks from insurance industry experts. Be better prepared ahead of the next storm. It’s a matter of when, and not if, the next hail and windstorm will happen. You’ll be thankful that you prepared for the worst before the skies turn grey and daunting.