by Heather Cournoyer | Nov 13, 2019 | Broker Advantage, Claims
In May we talked about the “Hard Insurance Market” and we are certainly feeling it more and more. Affordability and availability in certain classes are a huge issue. We are getting more requests for “quotes”. “How much would you charge for my insurance?”
Well that depends. How much protection do you want? Are you prepared to spend some time figuring that out? When was the last time you sat down with your insurance provider and reviewed your business operations, property values, values of stock and equipment? Are you at risk for a cyber-attack? Can you afford to operate if your website is subject to a ransom?
We don’t object to going to our medical doctor to have our annual checkup. In many ways, insurance shouldn’t be any different. Although it does seem to be standard practice to get the renewal, check the price and then move on. That’s unless the price has increased. Then we want a “quote”.
As a broker, it’s my responsibility to ensure that I understand enough about my client’s business to recommend adequate and suitable insurance protection.
Sadly, in the majority of cases with my new clients I deal with, we find out that there are gaps in their insurance that they were not aware of.
Let’s look at some examples:
General Contractor had leased a $150,000 piece of equipment on a short-term basis and advised his insurance provider. The broker told him it was covered. Upon review of their existing coverage, there was no endorsement or policy change reflecting that coverage.
· My advice – get everything in writing!
Wholesaler had ordered additional stock and had it stored at another location as he had no space at his premises. He failed to notify his insurer and assumed that it would be automatically covered as he had a sufficient amount of insurance to cover all his stock.
· My advice – Sometimes there may be a clause in the policy which will extend the cover for a short period of time. If so, it will be clearly stated in your contract. In my new client’s case, it was not included in the contracts. When in doubt call your insurance broker. It can be added for a small additional premium.
Home-based business – Caller operates an esthetics business from her home in the corporate name. She has Professional Liability Insurance for her business but no Commercial General Liability. If any of her clients are injured e.g. (slip and fall on the ice or snow) she has no insurance protection.
· My advice – She should have been advised to see if her home insurer will provide her with a home-based business liability extension on her home insurance. If not, she should purchase a Commercial General Liability policy.
These are just a few examples of situations that can lead to a costly claim with no insurance coverage.
When in doubt ask and get it in writing.
For more information contact Heather at heather@thinkinsure.ca or text or phone 587-597-5478.
by Heather Cournoyer | Oct 23, 2018 | Claims, Rental Property
No two insurance policies are exactly the same and when it comes to insurance on single or multi-family or commercial buildings for rental properties, its buyer beware.
1. Will this coverage provide full replacement cost on my building and contents in the event of a loss?
Coverage can be purchased for replacement cost (cost to rebuild) or actual cash value. If there is a loss and actual cash value is in place, depreciation will be applied to your claim and you will have to pay a portion of the cost to repair or rebuild.
2. Is the coverage all risk or named perils?
Even though All risk coverage does have exclusions however Named Perils only covers certain types of losses. Obviously, the All Risk option is the better form of cover.
3. Is damage caused by the tenant’s covered?
Many policies for rental properties will not cover damage caused by the tenants unless it’s a fire.
4. Will I recover my lost rental income in the event of a loss?
The reason you have rental property as an investment is two-fold. Hopefully, the property value increases over time. Secondly, you need the cash-flow to pay the mortgage, taxes etc. Make sure that you purchase rental income insurance to the full value of the annual rent!
5. What happens if my property is vacant?
All property insurance has a 30-day vacancy clause. If you don’t arrange with your insurer to add a vacancy permit, you will have no insurance.
6. Is there coverage for water damage?
Water damage is now the most common causes of loss in rental property. Anything from sewer back-up, overflow of water from a domestic appliance, frozen burst pipes or flooding. Make sure to find out what claims will and won’t be covered so you can plan accordingly.
7. How much do I have to pay in the event of a loss?
All policies carry deductibles, normally meant to encourage you to pay the smaller losses yourself. These deductibles can range from $500 up to in some cases $25,000 depending on your loss history and the type of loss.
8. Are there any special conditions I should know about if my rental is a condo unit?
Although the Condo Corporation does insure the building, you still have to cover the contents and liability. Also, be aware that the by-laws of your condo Corporation may require you to pay the deductible on any loss caused by the negligence of your tenant. Those deductibles can be anywhere from $2,500 to $50,000.
9. Are there any warranties in the policy?
So, what’s a warranty? It’s a promise to the insurance company that you will do something and if you don’t, your insurance won’t cover that loss. Let’s say your building is vacant. The insured has provided you with a permission for vacancy endorsement with a 72-hour Supervision Warranty. If you do not check the property as outlined in the warranty and you have a claim it won’t be covered.
10. Most importantly…. Should my tenants have their own insurance?
Absolutely! Ensure that your tenants to carry their own Tenants Package Policy! Ask them for either a copy of the policy or a certificate of insurance.
Click Here to ensure that you always receive these “hot-off-the press” tips about how to protect your business and your livelihood!
For more information contact Heather heather@thinkinsure.ca or 587-597-5478
