8 Important Tips for First-Time Home Insurance Buyers In Canada

Published On: November 1st, 2022Categories: Personal Insurance

Buying home insurance is a critical decision that every homeowner has to make. Unfortunately, the price of home insurance in Canada continues to rise, and Canadians have to dig deeper into their pockets to afford the premium.

Whether you are a first-time homeowner or looking for a new insurance provider, you need to learn a few tips to help you make the right decisions.

With several insurance providers available in the market, knowing how to choose the best can save you money and ensure you are well protected.

Here are some tips that home insurance buyers in Canada should consider when purchasing home insurance.

1. Do Some Research

Your home is one of the most significant investments you can have. This means you must ensure it is fully protected in an emergency. To do this, you must find a home insurance provider who can cover all your risks at an affordable rate.

Before choosing an insurer, you must understand your risks, home insurance rates in your area, and what can affect your premiums. For example, if you live in a tornado-prone area such as Alberta or southern Quebec, you may need to ensure your home against tornadoes.

Also, check out the property’s Comprehensive Loss Underwriting Exchange (CLUE) report for more information about the losses and claims on the property for the last seven years. Do not forget to look into other crucial factors, such as the crime rate in the neighbourhood and any other factor that can affect your premium.

2. Bundle Up

Several insurance companies offer discounts to property owners who choose to bundle up. Suppose you have auto insurance with a particular insurance company. In that case, you should bundle up your auto insurance with your home insurance and save more money.

This is one of the best ways of saving money and having adequate insurance cover for your home. Apart from saving money, bundling up your insurance will also:

  • Make managing your auto and home policies easier
  • Make the claims process easy
  • Help you save time
  • Reduce paperwork

Talk to your auto insurer and know if you qualify for a bundling discount and the benefits you can enjoy when you bundle up.

3. Ensure the Home is Up-to-Date

Suppose you are buying an older home. You have to ensure it is up-to-date. Before providing coverage, several insurance providers inspect homes to know if certain crucial features have been updated.

Therefore, before you buy home insurance, schedule a professional home inspection and ensure the electrical, heating, plumbing, and roofing systems are up-to-date. Note that it is crucial to have a property inspected before you buy it.

However, if you choose to buy a home as-is, do the necessary updates and renovations before buying insurance. Remember, the lower the risks, the lower the premiums. If the property has a pool, update the security features such as having a pool cover to reduce risks.

4. Watch Out for Over Insurance

It is crucial to understand the difference between the replacement value of a home and the actual cash value. The cost of rebuilding or replacing a home is not the same as the current market price of a similar home.

Also known as market or resale value, Actual Cash Value (ACV) is the price of the property on the market after depreciation. It accounts for the housing demand, location, and land. All these factors have no direct relation to reconstruction.

On the other hand, replacement or rebuilding value is the total price of completely rebuilding a home after destroying the initial home. Replacement value includes building permits, construction materials, skilled labour, and price.

When buying home insurance, be sure the policy covers the replacement value of your home and not the ACV. In case of a total loss, you will have enough money to replace your home.

5. Insure All Your Assets

When insuring your home, you also need to cover your assets or the property inside the home. Home insurance policies cover personal possessions up to a certain limit. The policy can also include additional limits for speciality property.

Valuable items in your home can include family heirlooms, antiques, furs, fine arts, designer clothes, state-of-the-art appliances, expensive watches and jewellery, musical instruments, and more.

Get to know the personal items the insurer can cover and the dollar amount. Document all your assets or content of your home. This can include taking pictures and having a detailed description of the items, including serial numbers, model, and date of purchase.

6. Home Insurance Buyers Must Be Aware of Coverage Gaps

Every home insurance policy has certain exclusions. Some policies, especially standard policies, do not cover items such as backup sewer damages, earthquakes, or floods. To ensure your home is adequately covered, fill all coverage gaps that can affect you.

Learn your risks and add the right additional coverage. Also, consider including an umbrella policy for liability coverage or extended replacement cost coverage.

7. Get Discounts with a Good Credit

Insurance companies offer significant discounts to homeowners with a good credit score. This is because a good credit score portrays a person’s ability to pay their premiums on time.

To enjoy this discount, allow the insurer to run a soft hit on your credit history. Depending on the insurance company, a good credit score can give you up to 50% off your premium. This will help you save a lot of money.

8. Work With an Insurance Broker

Buying home insurance and getting the best rates is never easy. With different factors to consider, contacting different insurance companies to know what they offer can be hectic and time-consuming.

To save time and get the best insurer, you should consider working with an insurance broker. These professionals have more knowledge of insurance policies and a network of several insurance providers. They will help you get the right insurer and the best quote.

Choose the Right Home Insurance Company

Though you legally do not need home insurance, covering your home and assets from risks will help you save a lot of money in a disaster. New home insurance buyers should consider the above guide to make the right choice.

If you are looking for home insurance, contact our team at Bryson Insurance and get professional and personalized insurance services.


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Written by:

Kyle Paterson
Kyle believes that insurance is a tool, when powerfully leveraged best ensures the vision of business leaders and families are realized. Kyle focuses on cyber risk transfer, group benefits, and corporate and individual life insurance solutions.


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