Home Insurance Brokers: directory of firms

Replacement cost and actual cash value are two different promises. Under replacement value coverage, the Financial Consumer Agency of Canada explains, you receive the actual cost to replace an item following a covered loss. Under actual cash value, you receive the cost of the item when it was new, minus depreciation, which on a fifteen-year-old roof or a decade-old television is a materially different outcome.

The same reasoning applies to the building. The Insurance Bureau of Canada's guidance is that the amount for your building should correspond to what it would cost to replace it if it were completely destroyed. That figure moves with construction costs and with anything you have added: a finished basement, a rebuilt kitchen, an addition, an upgraded electrical system. A brokerage that asks detailed questions about the structure, the age of the roof, the plumbing and the heating is doing the job properly, not prying.

Ask specifically which parts of your policy are settled on which basis, because a single contract can use replacement cost for the dwelling and actual cash value for particular categories of contents or for a roof past a certain age. That answer belongs in writing, before a claim, not in a phone call afterwards.

Whoever arranges the policy must hold a general insurance licence in your province. In British Columbia, the Insurance Council of British Columbia's online Insurance Licensee Directory publishes licence information for current licensed agents, agencies, adjusters and firms, including status and class. In Ontario, general insurance brokers are licensed by the Registered Insurance Brokers of Ontario, which publishes a broker search and a brokerage search and encourages consumers to use them. The Financial Consumer Agency of Canada's advice is blunt: agents and brokers must be licensed in the province or territory where they do business, and you should confirm that before dealing with them.

Your own obligation runs alongside theirs. The application is the basis on which the insurer agrees to cover the property, and the Financial Consumer Agency of Canada's guidance is to answer all questions completely and honestly, since failing to do so could result in a policy being cancelled or a claim being denied. If you are unsure whether something matters, say it anyway and let the underwriter decide; a disclosed detail is an underwriting question, while an undisclosed one becomes a coverage dispute at the worst possible time.

Most of the fine print a homeowner actually encounters is about water and cold. Policies commonly attach conditions to periods when a home is unoccupied in winter, and the Financial Consumer Agency of Canada's example of frozen pipes when a home is left for more than four days in a row in cold weather is exactly the kind of condition that decides a claim. If you travel in winter, ask what your policy requires: heat maintained, water shut off and drained, or someone checking the house on a stated schedule, and get the answer in writing before you leave.

Spring brings the other half of the problem. Overland water coverage exists because heavy rain, spring thaw and overflowing rivers are not part of standard wordings, and sewer backup coverage exists because drains and sump pumps fail under the same conditions. Backwater valves, sump pumps with a backup power source and grading that carries water away from the foundation reduce the chance of the loss happening at all, and are worth raising with a brokerage as part of the conversation about which optional coverages to buy.