You should insure your home for what it would cost to rebuild it sometime in the coming year.

(a) Some policies cover only “named perils” — in other words, if the “peril” (the cause of the damage) isn’t listed on your policy, it isn’t covered. This is generally referred to as a standard policy.

(b) Other policies cover named perils on the contents of your home and “all risks” on the building. “All risks” provides insurance for losses due to a wide range of causes. But instead of listing what is covered, an all risks policy lists what is EXCLUDED, or NOT covered. This is generally referred to as a broad form policy.

(c) Still other policies cover all risks on both the building and its contents, but is still subject to some exclusions. This is generally referred to as a comprehensive policy.

The dollar limits to replace stolen cash, or garden tractors, watercraft and computer software are relatively small. Coverage limits may apply also if the following are stolen: bicycles, jewellery, watches and furs, coin, stamp and card collections. Reasonably priced supplementary insurance is usually available. This supplementary insurance, often called “riders” or “floaters,” provide extended coverage for these specific items. Coverage can be world-wide and there’s usually no deductible. Discuss the items that you may want specifically listed to be insured with your representative.

Most claims on home policies are paid on a replacement cost basis, meaning that the insurance pays the cost of replacing the damaged or lost item with a new one that is as close to the original as possible in functionality and quality. However, some policies may pay only actual cash value, which means replacement cost LESS depreciation. Ask your insurance representative what you have. Of course, you have to actually replace the item in order to receive replacement cost for it.

The city tax appraisers are only concerned with what the real estate value of your home is. What would it sell for on the open market. Your Insurance Broker is interested in what it would cost to build a home of “same like, kind and quality.”

Typical insurance brokers are not expert appraisers, however they will ask you a series of questions about your home. Is it custom built? Standard track housing? When was it built? (If it was built in 1909 it will likely have oak or maple flooring, this will impact on the cost to replace your home.) How many bathrooms? Swimming pool? Etc. These answers will most often be entered into a computer using ‘Compuquote’ or ‘Boeckh Appraisal’ software. These programs are simple evaluators to estimate the cost to rebuild your home sometime in the near future. Some insurance companies offer Guaranteed Replacement cost when using evaluation programs, provided your home meets the qualifications. Ask your broker if you have Guaranteed Replacement cost insurance.

First, whenever you have a lifestyle change like this, tell your insurance representative because there will usually be restrictions on such things as theft and damage by tenants. He/she can outline these restrictions so that you can be take precautionary measures. Other lifestyle changes that warrant a phone call to your insurance representative include: home renovations, home exchange programs, running a small business from your home, installing a home security system, purchasing a cottage/boat, etc.

An application is the initial request, declaration, or statement made when applying for an insurance policy. It can be verbal, written or by use of a printed form.

Automobile Insurance is an insurance policy designed to insure exposures arising out of ownership or operation of an automobile, including but not limited to third party liability, accident benefits and physical damage to the insured automobile.

You can purchase Automobile Insurance at any ‘Autopac’ registered brokerage. Our broker locator can help you find a brokerage in your area.

One who is an independent middleman, not tied to a particular company, who obtains insurance for his/her clients from insurance companies or their agents.

One who, without having possession or control of it, negotiates the sale of merchandise.

A clause in certain property insurance policies which provides for the application of a penalty for partial losses when owners of property fail to insure, as a minimum, to the percentage of the value of such property as specified by the insurer, e.g., 80, 90 or 100 percent.

A bond issued for a fixed amount which protects an employer against loss through dishonest acts of his/her employees.

If a broker uses an evalution program to estimate the replacement value of your home at $150,000, a fire occurs and the cost to rebuild your home is $155,000, the company will pay the $155,000 even though your policy shows $150,000. It is important to ask your broker if you have Guaranteed Replacement cost insurance on your home.

It is important to note that most Replacement Cost Endorsements pay for the cost of repair or replacement, which ever is less. Therefore, if the damaged item can be repaired to its pre-claim condition at a reasonable cost, it would be repaired instead of being replaced.

Policy is a term used to describe all contracts of insurance, including all clauses, riders, endorsements and renewals.

Conditions developed by insurer which describe the rights and duties of insurer and insured. See Statutory Conditions.

An amount added to the premium that reflects the various expenses associated with issuing the policy.

A clause designated to protect the interest of the mortgagee. Contains terms agreed to by mortgagee and insurer respecting the insurance policy, e.g., provides for payment to mortgagee in circumstances where insureds themselves would be denied coverage, outlines requirements where policy changes or termination requested, etc.

Statutory conditions are legislated policy conditions outlining duties and responsibilities of insured and insurer under contracts of automobile insurance, accident and sickness insurance and property insurance. See Policy Conditions.

A home in the Wolseley area of Winnipeg can be purchased for $85,000, the Appraised Tax Value of this home would be $95,000, yet the amount of insurance would be $187,000. This is because it would cost approximately $187,000 to rebuild the home with the same high quality materials that were used in 1909.

When you buy a home, farm business or automobile insurance through in independent insurance brokerage, you are using the services of qualified professionals who understand your needs. Independent brokers are not tied to any one insurance company. They have access to an extensive range of policies offered by many of the major property and casualty insurance companies in Canada.