Property insurance products take a lot of factors into consideration when determining your home and contents insurance rates.
Some of these factors include:
The location of your home
Where you live can greatly influence your rates. City residences usually provide better fire protection but may also bring higher break-and-enter or vandalism exposures. Specific factors include:
- Distance from your home to the nearest fire hydrant
- Distance to the nearest fire hall and whether it employs full-time or part-time firefighters
- If you live in a Metropolitan area
Your home itself
The construction of your house also influences your rates.
- How many storeys is it?
- Do you use auxiliary heating, such as a wood stove?
- Age of the building?
- Have you made upgrades to wiring, heating, plumbing and roof?
- Do you live in a detached dwelling, small apartment, high-rise apartment or townhouse?
- How many families live in the dwelling?
- Do you own and maintain protective devices like dead-bolt locks, alarms and smoke detectors?
- And of course, the cost to replace your home and contents in the event of a loss plays a large role in the cost of insurance.
Underwriting criteria
Underwriters look at many factors, rules and guidelines to determine the amount of coverage your home should maintain, as well as applying deductibles and discounts.
The insurance policy — additional coverages, deductibles and discounts
Additional coverages provide you with a high degree of customization — allowing you
to purchase optional coverages that may help provide you with even more protection.
Typical options include:
- Increased liability limit
- Liability extension to other properties or exposures
- Personal Umbrella Liability
- Rental income replacement in case a rental property is un-rentable due to a covered loss
- Earthquake coverage
- Home-based business extension
- Burglary / vandalism (optional purchase at a seasonal dwelling)
- Sewer back-up coverage
Deductibles: portion of a claim you agree to pay
Typically, the larger the deductible you agree to maintain, the lower your premium.
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