What Does Home Insurance Cover?

Homeowners purchase home insurance because they know they need to have it, but many don’t fully understand what is actually covered in their policy. There are so many inclusions, exclusions, complicated terms, etc., that it can be hard to wrap your head around all the details.

At Dumfries, we want to help people better understand their coverages. We want to make sure you have the best coverage for your needs and the knowledge to make informed choices.

Here are some of the most important things to know when it comes to your home insurance.

What does home insurance cover?

Here are four main items that are covered by a home insurance policy:

1. First and foremost, your home (AKA ‘dwelling’) is covered. That is the primary focus of any home insurance policy.
2. When it comes to your home, most policies will include the ability to replace your personal property. Replacement cost is the amount of money that it would cost to replace those personal items before they were damaged or destroyed.
3. Detached private structures are also included. These could be a shed, gazebo, garage, etc.
4. Additional living expenses are included, in the event that you have to live elsewhere, while your home is being repaired or rebuilt due to an insured peril.

What are additional living expenses?

Additional living expenses (ALE) cover the cost of alternate accommodations and living expenses for people who are prohibited from returning to their home or cannot return home because it is unlivable as a result of insured damage.

What is included in additional living expenses?

Your ALE coverage will typically cover:

• Costs that you incur to maintain your normal standard of living if you cannot live in your home while repairs are being made. If you decide to permanently relocate, costs could be covered for the reasonable time required to settle somewhere new.

• Costs to cover the rental value of a detached, private structure or unit if it was unlivable (i.e. cannot be rented) for the reasonable time required to be repaired or rebuilt. For example, if you are a landlord, you could be covered for the monthly rent during reconstruction.

• Costs to cover not being able to access your home or rental unit for up to 30 days, if damage was caused to your home by an insured peril on a neighbouring property and a ‘Civil Authority’ (any person acting with authority under a Federal, Provincial, or Territorial legislation) prohibits you from accessing your home.

• Costs to cover an emergency evacuation. For example, if you were prohibited from accessing your home by a Civil Authority because of a sudden or accidental emergency, you could be covered for up to 30 days or $3000, whichever is less.

Ask Your Agent

Depending on your unique situation, you may be able to purchase an ‘additional rebuilding cost’ or ‘guaranteed replacement cost’ endorsement and/or a ‘combined limit’ endorsement. Combined limit offers protection if the limit under one of the items listed above under “What does home insurance cover” is insufficient. This would allow you to “borrow” from one of the other limits. Your agent will be able to recommend the best coverage for your unique situation and needs.

7 things that you didn’t know are covered by your home insurance

Many homeowners know that their home and property are covered, but here are seven additional protections included in a Dumfries plan:

1. Personal property stored in a warehouse is covered for theft (with varying limits).
2. Personal property of a student away from home, or dependent or parent in a nursing home or health care facility (with varying limits).
3. Outdoor swimming pools are included in the dwelling limit.
4. Lawns, outdoor trees, shrubs, and plants – up to 5% of personal property limit. The maximum will vary depending on the plan.
5. Refrigerator and freezer foods, due to power failure or mechanical breakdown.
6. Fire department charges.
7. Our Plus Package includes lock replacement or rekeying if keys are stolen; emergency services forced entry repair up to $5,000; identity fraud up to $10,000; grave marker damage up to $5,000 for parents or grandparents.

Do you know what is covered in your home insurance? If you aren’t clear on what your home insurance policy actually includes or you have questions about how you can improve your coverage to meet your needs, contact us. We’re here to help.

Our team strives to present accurate information at the time of publication. In the interests of time and space, complete wordings are not included. If you have specific questions about our insurance products, please contact an agent or broker. The information in this article is non-binding to the company. What Does Home Insurance Cover?