Understanding Property Insurance

• Home is a major financial investment for many people.
• Property insurance protects against property loss or damage, including homes, buildings, and belongings.
• Property insurance provides financial security, covering against risks like disasters, theft, fire, and vandalism.
• Key topics are principles, coverage types, insurance companies, risk assessments, and the claims process.

What Is Property Insurance

• Property insurance safeguards homes, businesses, and personal items from risks such as fire, theft, liability, and weather-related damage.
• It offers financial aid to owners or renters if their property sustains damage.
• Policies may cover injuries inflicted on others while on the property.
• Coverage usually includes structural elements, personal belongings, liability issues, and occasionally, temporary living costs or business interruptions.

Types of Property Insurance

• Homeowners insurance policies cover the home's structure, personal property, liability for injuries, and living expenses if the home is uninhabitable due to a covered loss.
• Commercial property insurance protects a business's physical assets from damage or loss which includes buildings, equipment, inventory, and other assets.
• Renters insurance covers legal costs if you are accidentally responsible for damage to someone else's property or injury in a rental unit.

Homeowners Insurance Forms

• Basic Form covers only specific risks and is suitable for seasonal cottages, but carries the most financial risk.
• Broad Form covers the home more extensively and provides basic coverage for other specified items.
• Comprehensive Form (All-Risk) is the most common, offering the highest coverage, protecting the home and belongings from all risks except those specifically excluded in the policy.

Commercial and Rental Insurance

• Commercial property insurance covers risks to businesses.
• Commercial property policies protect businesses' physical assets from risks, while renters' insurance is important, even without property ownership, as it covers legal costs in case of accidental damage or injury.

Personal Property Coverage

• Protects against loss or damage to the home and personal belongings like furniture, clothing, and jewelry.
• Types of coverage include Actual Cash Value (ACV) and Replacement Cost Value (RCV).
• Create a list of possessions, including replacement cost, photos, and receipts, for coverage determination.

Liability Insurance

• Protects against legal liability for injury or damage to others' property.
• Minimum coverage in Ontario is typically $1 million, but it varies by situation and province.
• It covers bodily injury, property damage, legal fees, and settlement costs.
• Without liability coverage, you risk paying out-of-pocket for lawsuits and jeopardizing assets.

Jewelry Special Rider Policy

• A jewelry rider is an addition to home or renters insurance that covers jewelry for theft, damage, and loss, typically up to its appraised value.
• The rider typically costs 1-2% of the jewelry's value annually and offers coverage higher than standard policy limits.
• Jewelry riders often provide worldwide coverage, making it useful for those who travel or take jewelry on vacation.

Special Risk Policies

• Special risk policies provide coverage for hazards not typically included in standard insurance, such as floods, earthquakes, and fire.
• Flood and Earthquake Insurance is often excluded from standard policies but required in high-risk areas, with availability and terms varying by location.
• Vacant property and Fire Insurance covers increased risks for vacant properties and fire insurance, which may be purchased separately or as part of a policy.

Exclusions of Insurance

• Commonly covered events are fire, windstorm damages, and theft.
• Exclusions typically include earthquakes and floods (requiring additional coverage), war, terrorism, nuclear risks, and intentional loss (e.g., fraud).
• Government and property-related losses due to government seizure and destruction of property are not covered.

Property Insurance in Business

• Covers lost income if a disaster temporarily halts operations.
• Can cover employee wages, rent, and temporary relocation costs.

Commercial Real Estate Insurance

• Protects landlords and business property owners from damages and liability claims.
• Is required for businesses that lease or own commercial space.

Claims Process

• Policyholders must report damage to the insurer as soon as possible.
• Claimants should document damage with photos, videos, and receipts.
• An insurance adjuster evaluates the claim to determine the payout.
• Some claims are denied or disputed due to underinsurance or policy exclusions.

Deductibles

• The deductible is the amount paid out-of-pocket before insurance covers a claim.
• Higher deductibles lower premiums but increase costs when filing a claim.
• Deductible types include Standard, disaster-specific (hurricanes, floods), and disappearing deductibles.

Trends and Emerging Issues

• Climate Change and Property Insurance result in rising premiums, increased claims, withdrawing from high-risk areas, and stricter policy terms.
• Technology in Risk Management, includes predictive analytics and smart home technology for loss prevention.
• Cyber Risk leads to growing cyber threats in property management and an increased demand for cyber coverage.

Post-Claim Underwriting

• It occurs when an insurance company reviews a policyholder's medical history after a claim, aiming to prevent fraud and keep premiums low.

Chubb

• Chubb is a high-end insurer that was founded in 1882.
• Chubb requires a detailed inventory for coverage.
• Chubb covers full replacement cost, with no depreciation.

Intact Insurance

• Canada's largest insurer, founded in 1809.
• Intact Offers Guaranteed Replacement Cost for homes.
• Intact provides 24/7 customer support for policyholders.