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Home Insurance Quickguide: Protection for your residence
Whether you live in a rental, condo or
house, you need
the protection of home insurance.
Whether you live in a rental unit, a
condominium or a house, you should understand the ins and outs of
choosing an insurance policy that best fits your
needs. Keep in mind, you should always ask yourself "What's not covered
in my policy."
Tenant
or renters insurance
If
you've just moved into your first apartment, you may think that you
don't have anything of real value to insure. A computer, CD player, and
some clothing may not look as if it's worth that much. But, if you ever
have to replace some or all of it, it could overwhelm your finances.
Consider the following scenario: Say you bought a computer on credit
and it gets stolen or destroyed by fire. You're still responsible for
paying off the balance owing, even though you no longer have the item.
As a tenant or renter, it's a wise
decision to take out a tenant insurance policy. You see, as a tenant or
renter, you are responsible for any damage you may cause to any part of
the building you live in, or for any harm you may cause to other people
who live or visit the building. For example, if you forgot to turn off
the water in your bathtub, you could cause water damage to your
premises, and also to your neighbors property. You would then be
financially responsible to repair any resulting damages.
Tenant or renters insurance can
protect both your contents and your liability exposure.
House
insurance
If you own your own house, then you'll
want to protect not only your
physical building, but all the things in your house too. A standard
house insurance policy will ensure that if something like vandalism,
fire, or theft occurs, then you'll be protected and your valuables will
be replaced (to the extent of your coverage).
You should also think about protecting
any other structures, like a detached garage or poolroom, that exist on
your property. Also, in the event that your house is damaged, and you
need to move out for a while, you may want to consider a policy that
will help pay for out-of-pocket expenses like food and alternate
lodging for you and your family.
As a homeowner, it is possible that
you may be held liable for accidents that people have while on your
property. Also, you may accidentally damage someone else's
property, either in your own house, or elsewhere. A
well-structured home insurance plan will make sure that you're covered,
should any of these unforeseeable events occur.
Condominium
insurance
Purchasing
a condominium,
means that you own your "unit," but you also own a share of the common
areas of the condominium. As a condo owner, you could be held
responsible for harm you might cause to any part the building, or to
others who live or visit the condominium complex. The purchase of a
condominium insurance policy can remove some of the financial worries
of condominium ownership.
Essentially, you need to make sure
that two separate policies are in place to fully protect your
investment.
- Your own insurance policy for your unit. This insurance policy
will provide coverage for your personal property, structural
improvements to your unit and additional living expenses if you are the
victim of fire, theft or some other disaster listed in your policy.
Make sure that you have sufficient liability protection to protect you
for harm you might cause to any part of the building you live in or
harm you may cause to others who live in or visit the condominium
complex.
And,
- A "master policy" purchased and provided by the condominium
board. This covers the common areas and things you share with others in
your
building, like the roof, basement, elevator, lobby,
swimming pool, parking garage and heating unit from both liability and
physical damage.
Take the time to find out what's
included in the condominium corporation's policy. You can then decide
what to include in your personal insurance policy.
For instance, sometimes the
condominium corporation is responsible for insuring the individual
condominium as it was originally built, including standard fixtures. In
this case, you'd only be responsible for insuring your personal
property and any alterations or additions that you or a previous owner
have made to the original structure of the condominium. Upgrades like
remodeling the kitchen or bathroom would be your responsibility.
In other cases, the condominium
corporation is responsible for insuring only the bare walls, floor and
ceiling. You'd be responsible for insuring your personal property, plus
things like the kitchen cabinets, built-in appliances, plumbing, wiring
and bathroom fixtures.
Limitations
of your house, condo or tenants insurance coverage
Your standard policy will likely have
limitations in theft coverage for
jewelry and furs, silverware, business property, bicycles, cash money
etc. If you wish to fully protect any of these types of items,
it's a good idea to consider adding additional coverage to your policy.
The
deductible
If you should have to make a claim, a
small portion of the claim is
always paid by you first. This is called your deductible. Your
insurance company then pays the rest (up to the limits of the policy).
The amount of your deductible affects the price of your insurance
policy. The lower your deductible, the higher the premium and the
higher the deductible, the lower the premium. Consider the impact of
having to pay a high deductible in an unfortunate situation. Just
because it will lower your premium now, does not necessarily mean that
it
is automatically the right thing to do.
The
price of coverage
The best advice anyone could get when
they are trying to get the best price for the coverage they need, is to
compare several quotes before they purchase. It's surprising how often
there is a considerable difference in price for essentially the same
coverage from one insurer to another. Get several quotes through
kanetix, and don't
forget to read and understand the policy before you buy.
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Disclaimer - The above description/explanation is intended as a guideline only, and is not to be interpreted as a recommendation to buy or sell any insurance products, or to provide legal or financial advice of any kind. Also, Kanetix Ltd. does not warrant or assume any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed.
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