Homeowner’s Insurance: Question & Answer

Q: What’s the difference between vacant property and unoccupied property?

A: Property is deemed to be vacant when the occupants have moved with no intention of returning regardless  whether they left personal property behind. Insurance will not cover vacant property. Property is deemed unoccupied when there is an intention to return to it. Insurance will cover it.

Q: Is my house covered if I am on vacation?

A: Generally speaking, your insurance coverage continues while you are on vacation, but the length of time you are away and the steps you take to protect your home while you are away, can impact whether a loss is covered.

If you are planning to be away for more than a couple of days, it is recommended that you contact your insurance broker to determine what action you must take to protect your home from loss and ensure a claim is not denied. This is most critical during colder months. For example, there is no coverage for damage caused by freezing of any part of a plumbing, heating or domestic water container unless you had arranged for a competent person to enter the dwelling on a daily basis.

Q: My car was broken into while I was shopping at the mall. A brand new golf bag and a leather briefcase I had just purchased for my husband were stolen from the trunk. Do I claim these items through my automobile or homeowners’ insurance policy?

A: Your home insurance will cover items stolen from you car that are not permanent fixtures of your car, as long as you have receipts to prove ownership of those items.

Q: Who is allowed to drive my car?

A: Technically, anyone to whom you give permission is allowed to drive your car. This is because your insurance is attached to your car, regardless who is behind the wheel. But, if a driver you’ve authorized gets into an accident with your car it is your driving record that is affected. In Nova Scotia, all licensed vehicle owners must carry liability insurance. Liability coverage is extended to any person who holds a valid license and drives your car with your consent. Insurance companies want to know if there is anyone else besides you who drives your car on a regular basis.

Q: Why should I carry higher liability limits?

A: Court awards for personal injury are climbing all the time. You don’t want to be in a situation when you have an accident where the court awards a payment higher than what your insurance policy will pay. If this happens, you will be required to make up the difference from your savings and the sale of your personal assets.

Q: I travel a lot and usually end up renting vehicles. Do I need to buy the coverage offered by car rental companies?

A: If you frequently rent cars in Canada or the United States, it may be in your best interest to purchase additional coverage from your insurer that extends legal liability protection for you, your spouse and other named drivers to rental cars. Also, some credit card companies provide certain types of collision coverage for car rentals charged to that card; find out if your credit card comes with car rental insurance options.

If you do not have additional coverage from your insurer or credit card company, or are renting in a country other than Canada or the United States, then you should consider taking the protection offered by the car rental company.

Q: Why is my oil tank causing problems for insurance?

A: Your oil tank isn’t causing problems for insurance; but one day it might cause problems for the environment. The cost of oil spill cleanup from leaking or bursting home oil tanks has risen dramatically in recent years.

The average cost is now about $65,000, with many coming in between $100,000 and $200,000 as environmental clean-up must take place.

Remember, your insurance might not pay for the cost of a spill on your property, only the neighbouring property. In the absence of tough provincial legislation requiring oil tank inspection and replacement, it is up to you to inspect your tank regularly for leaks and to replace it in a timely manner. Call your home oil company to find out how to inspect your tank properly. And always call your broker to find out exactly what your policy covers.

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