Annual review of insurance best policy, experts say

WINDSOR, Ont. -- Some nasty storms that toppled trees onto houses and vehicles flooded basements last month had phones ringing at local insurance companies as homeowners pulled out their policies to see what was covered

There's not much reading drier than an insurance policy, but it is something every homeowner should do annually, say two local insurance brokers

"The No. 1 thing a customer needs to look at is what kind of policy they've got," says Kris Cosford, personal lines manager with PBL Insurance in Windsor. Know what is covered and for how much before disaster strikes

For most homeowners, getting the best policy comes down to balancing the coverage they need with the cost. Shop around when buying and renewing home insurance, something with which insurance agents and brokers that deal with more than one company can assist

Company websites and general sites, like InsuranceHotline.com, are also helpful for doing initial comparisons

Companies don't always raise their rates at the same time, so weigh the decision to jump carefully, Cosford says

An advantage of sticking with one company is that it may offer a loyalty discount, so make sure to ask

Cosford and Gillian Hamza, a broker who manages the Harrow office of Southland Insurance, say insurance should cover the value of replacing the home -- not its market value -- if it is destroyed

Most policies cover contents up to 70 per cent of the value of the insurance on the house, which is sufficient for most folks, Hamza says

The Insurance Brokers Association of Canada provides a home inventory form on its website to help homeowners determine how much coverage they need

"One of the highest recommendations that we can make is take a high deductible," says Cosford

A higher deductible means the homeowner covers more of the cost of a loss or damage. So instead of covering the first $500, they'd have to cover the first $2,500 to replace contents stolen during a break-in or repairs to the house after a fire

The cost of the deduction can often be recouped in a few years through lower premiums, Cosford says. As well, those with higher deductibles will likely make fewer claims, another factor in lowering cost the of insurance

"To me that's practical in this day and age," says Hamza

Coverage for damage from fire, theft, lightning, wind storms and hail is pretty standard, but such things as sewer backups cost extra

In some neighbourhoods, where basements have flooded in the past, the price is higher, there are limits on what can be claimed and some companies have even cancelled coverage

That is because these claims are costing insurers the most, Hamza says. Don’t wait until it’s too late, find out more about business insurance.

Cosford says she has had calls from customers who have thrown up their hands and left the floors and walls bare after their finished basements flooded for the second time

"A lot of them have no recourse. I feel badly for them."