Basic home insurance packages for homeowners, tenants and condo owners cover these 3 things:
- Buildings – Covers your house and other buildings on the property. Examples: garage, workshop.
- Contents – Covers replacement of your belongings, usually up to 70% of the amount you insure your house for.
- Liability – Covers any claims against you if someone is hurt or killed while on your property.
If you rent your home, or own a condo, your landlord or the condo company provides insurance for everything from the drywall to the outside.
Choose which damages to protect against
Decide which damages — often called perils in insurance policies — you want to protect against. Many people choose only theft, fire, lightning, windstorm, hail and certain types of water damage. You can also get coverage for everything from sewer backups, to earthquakes, to losing all the food in your freezer during a power outage. But remember — you will pay more for any extra coverage.
Add extra contents insurance
The amount you need to cover your personal possessions depends on their value. To decide if you need extra coverage:
- Create a record of everything you own, the date when you bought it, what it cost, and what it may cost to replace the item now. Take photos or videos. Use this home inventory form.
- Add up the value of everything you want to insure.
- Calculate how much insurance you can afford.
Do you want or need to fully cover everything you own? The more you cover, the more you’ll pay.
Insure valuables separately
Your basic home insurance may not cover the full value of costly items like fine art, jewellery or a boat. Or it may not cover them at all. Add a rider (also known as an endorsement or personal property floater) to your home insurance. Make sure it states clearly what extra items you are covering and for how much.
Don’t expect basic home insurance to cover everything. Learn about what is usually excluded and talk to an insurance expert.
Don’t pay for insurance you don’t need, but do get enough to protect you, your loved ones and your property.