Regardless of whether you rent or own, home and rental insurance can be difficult to understand, especially if you’ve never purchased any before. To break down what you need to know, we talked to Pete Karageorgos, director, consumer and industry relations at the Insurance Bureau of Canada.
7 tips for getting the best insurance rates
Karageorgos advises keeping the following tips in mind whether you own a house or are renting an apartment:
- Shop around – If he could offer just one tip to anyone looking to buy home or rental insurance, he says it would be to shop around. “Insurance is like buying anything else as a consumer … shop around for the best price and the best coverage,” he says.
- Deal with a reputable professional – You want to talk to an agent licensed by a provincial regulatory agency, such as the Ontario Financial Services Commission of Ontario or Registered Insurance Brokers of Ontario.
- Look for an office – Most licensed professionals will have an office, so it’s a red flag if someone just wants to meet you at a coffee shop.
- If you’re buying online, make sure it’s a reputable site – In-person meetings are recommended, so if you must make your purchase online, do it with caution. Check the government agencies that regulate insurance (each provincial regulator should have info on its website) to see what you should be looking for in an insurance provider.
- Look for payment plans – Legitimate places will give you payment options, Karageorgos says, rather than strictly cash transactions. “If someone demands just cash, that’s a big red flag,” he says. “Walk away.”
- Look for questions – An insurance representative should be asking you all kinds of questions about your needs. If someone is trying to sell you insurance and is not asking you a lot of questions, that’s an immediate red flag, says Karageorgos. If all they ask is, “What’s your address?” he adds, “You’ve got to wonder why that’s the only question they’re asking.”
- Try for a discount – “Many insurance companies will offer you discounts if you have more than one line of insurance with them,” Karageorgos says. A good representative will be asking you about your other insurance needs, such as car insurance that could be packaged with your renter’s insurance plan.
If you’re a homeowner, Karageorgos says, “Make sure the coverage is enough.”
He shares the example of the people who lost their homes in the Fort McMurray wildfires. Many of them did not have enough insurance to both rebuild their property and replace their belongings, he says.
Karageorgos says it is important you understand the parameters of your insurance agreement. “Find out what you’re responsible for if the situation changes,” he says. The way to do this takes us right back to tip #6 – look for questions.
An insurance provider should be spending at least 15 or 20 minutes with you. Questions they should be asking you sound like:
- How old is your house?
- How many square feet is your property?
- How many bedrooms do you have?
- When was the furnace last replaced?
On the flip side of that, you should be asking them lots of questions, too:
- Are there circumstances the insurance doesn’t cover?
- What is the deductible?
- What happens to my coverage if I renovate my home?
When it comes to renting, the big difference is that your insurance does not cover the building.
“Renters have to remember that they are insuring their property – their stuff, anything they move in with them,” Karageorgos says. This means things like your furniture, your clothing, your electronics.
“Take the time to understand the coverage,” he advises. And, again, get any questions answered.
For example, you need to know:
- What happens if someone claims you have injured them or their property?
- Will your living expenses be covered if you can’t live in your apartment while it’s being repaired?
- Does your plan include fire damage to your belongings, theft or power surges?
- Will your plan change if you buy some expensive furniture or jewellery?
Whether you own a home or rent, “You want to understand what you’re covered for,” he sums up. Purchasing home insurance is just like buying a car – there’s a huge range of options out there. Ask lots of questions so you can better understand the differences between all the available plans.