3 Surprising Reasons Your Home Insurance Goes Up
Home insurance is a funny thing. You might go years without making a claim, but one day you open a letter from your insurance company and read your premiums have jumped 15 per cent. It’s a mystery – and you’re stuck with the bill.
As you try to figure out what happened, consider it might be one of these three surprising reasons your home insurance goes up:
Extreme weather and aging infrastructure
We’ve all heard about the floods and freezing rain that seem to get more severe every ear. Whenever there is a weather warning, Canadians everywhere brace themselves and watch the skies for whatever Mother Nature decides to throw at them.
Severe weather events cost Canadians $1.6 billion in 2011 and $1 billion the two previous years. Water claims have now outpaced fire claims as the number one cause of home insurance losses across the country.
Combine these incidents with aging infrastructure like sewer lines, pump stations, and treatment plants that tend to fall over and die when overwhelmed with too much water and there’s a problem.
Also, high population areas like Toronto face additional issues. More people mean increased strain on outdated electrical systems that lead to brown outs and black outs. Put all these together and you’ve got a pretty big price tag that has to be paid by someone, and that means home insurance goes up for almost everyone.
Bigger and better homes aren’t cheap
You might have heard this stat before: the average home size in 1950 was 800 square feet. Fast forward a few decades and our average home size is now 2300 square feet. We also used to be cool with wood panelling, laminate floors, and Formica countertops. Now we’re all about the granite countertops and hardwood floors.
Basements used to be barren concrete wastelands where Christmas decorations, random bric-a-brac and the washer/dryer pair lived. Now we tend to spend a lot more money developing our basements with all the modern amenities. These nicer basements are more expensive to remodel when we flood. Insurance companies know that and adjust premiums accordingly – and that means home insurance goes up.
The best way to battle price increases is to do your homework and shop around for the best home insurance rate when your policy is up for renewal.
Backyard pools, trampolines, and your furry friends
Risk factors are considered broadly by your insurance company. Things like a pool or trampoline can raise your premiums. Backyard pools can be big liabilities and insurance companies tend to give them the stink eye.
Anything from injuries, like a bad trampoline bounce, to property damage, like your pool leaking onto the neighbour’s property, can send your insurance company round the twist. You’ll pay the price in premiums. Speak with your insurer about how to make your property safer and potentially reduce your rates.
Your insurance company may also charge you more if Fido is considered a riskier breed. Larger and more aggressive dog breeds can end with your insurer upping your premiums. You can, however, ask your insurance company to lower rates if you take your furry friend to obedience classes.
While you might not be able to control the weather, you may be able to lower premiums by negotiating with your insurer. Give them a call and see what you can do. Just because home insurance goes up for everyone else, it doesn’t mean it needs to go up for you.