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10 no-nonsense home insurance tips

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All Canadians will pay more for their home insurance in the coming year, whether or not they’ve made a claim. Your clients will be wondering why. Here’s how to explain how insurance works, and some proactive ideas you can pass along to keep them happy with their policies.

While there are several reasons policy costs go up, the main one is that your clients’ local home insurance providers are part of the worldwide market, says Square One Insurance. That means disasters (and claims) from across Canada and around the world affect the rates charged for their policies.

To help keep premiums down, tell your clients:

    1. Only insure belongings you own. Most home insurance policies include $6,000 of coverage for fur coats and $5,000 for gold bullion. If you don’t own either, why pay to insure them? Find a provider that lets you personalize your policy to your needs and pocket the savings.
    2. Don’t over-insure your house. If you own a house, you should only insure it for the amount it would cost to rebuild, not what you paid for it. When you bought your house, you paid the market price for the house and the land. Home insurance only covers the house.

  1. Increase your policy deductible. The standard policy deductible on most home insurance policies is $500. This amount made sense 20 years ago, but it is quite low by today’s standards. Increasing your deductible to $1,000 or $2,500 is one of the easiest ways to save money.
  2. Don’t file claims for small losses. You have the right to file a claim no matter its size, but keep in mind your policy includes a claims free discount that can total 20% or more. So, do the math before submitting your claim. You might be better paying a small loss out of your own pocket.
  3. Find an interest-free monthly payment plan. Most providers offer monthly payment plans, but beware because not all plans are created equal. Many plans charge interest rates that are higher than what you would pay on your credit card. So, look for plans that are interest-free.
  4. Shop around for the best coverage and rate. Just because you’ve been with your current provider for many years, or you buy both your home and auto insurance from them, doesn’t mean you’re getting the best deal. Get comparison quotes online and you’ll likely do better.
  5. Recommend your friends. If you’re happy with your provider, ask if they have a referral program. Some companies offer account credits for each person you refer who buys a policy. Not only will you save money, but you’re helping your friends save money, too.
  6. Install a backwater valve. These devices prevent water backing up into your home from the city sewer system. The device costs about $100 and installation costs about $1,000. Many cities offer rebates, and some insurance providers offer discounts for installing these devices.
  7. Replace plastic and rubber plumbing hoses with braided steel ones. Plastic and rubber hoses connected to fridges, dishwashers, washing machines and toilets are prone to cracking and leaking over time. Replacing these hoses with braided steel ones to reduce the chance of a loss, which helps keep your premiums low.
  8. Install a monitored burglar alarm. All insurance providers offer discounts if you have a burglar alarm installed, activated and monitored. So, consider installing one. Not only will you save money on your home insurance, you’ll also have some extra peace of mind.


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Wow, tip #2 is so ridiculous that I am amazed it made it to print. All home insurance polciies have special limits for certain type of contents and gold and jewellery are two common ones but you don’t pay for having a restricted cap!
Go straight to tip #7 and partner up with a knowledgable agent or broker next time you want to provide tips for home insurance.

Wednesday, Feb 12, 2014 at 8:46 pm Reply


The best tip is #8; install a backwater valve. Sewer backup is one of the biggest concern the insurance industry has right now. It is mainly due to weather and deterioration of our infrastructure.

Home insurance is set up as packaged policy, which comes with some standard/minimum coverage, like cash, fur coats. Insurer would not tailor such immaterial coverage to every individual client. If a customer needs more than standard coverage, then purchase more.

Increasing policy deductible, installing a monitored alarm would reduce insurance cost. In reality, we should all rely on home insurance policy to look after major losses. When a homeowner files minor eligible loss once every 2 years, there would be a frequency concern. No matter what business you are in; would you like the same customer keeps returning your merchandise all the time. Once is an isolated incident; twice could be a coincident; the third time has become a frequency issue. Why would you think another insurer would offer you cheap rates knowing you claimed frequently. Your home insurance policy is not a household maintenance contract.

It is interesting that we talk about building relationship with our customers every day. Yet customers forgot about building long term relationship with the service providers. We should shop around for better rates, and we must consider the type of service and advice provided by the service provider. Can you get a hold of your insurance agent in an emergency at night and/or over the weekend? Is your insurance agent willing to work with you on claim issues?

Friday, Aug 29, 2014 at 12:48 pm Reply