Moving and how it affects your home insurance
Spring is a popular time to move.
If you’re a homeowner putting up a for sale sign, there’s going to be lots on your to-do list. One of the most important tasks is taking care of your home insurance.
Home insurance premiums are based on a variety of factors – including location, replacement cost, utilities, extra amenities, and more. Where you are moving to is likely going to be very different than the home you live in now.
Here is a guide to make sure all the bases are covered:
1) Inform your insurance broker When the purchase of your new home is confirmed let your broker know when you will be leaving the current house and taking possession of the new one. In fact, that’s good to know beforehand because it will help you figure out the total cost – including insurance premiums – of the property. Your broker can help you manage your insurance transition and ensure that you are adequately covered at all stages of the move. Remember, you’ll want the right type of coverage if you’re moving from a condo to the suburbs or from a home to an apartment. They will review your current policy and advise you of any premium change. If you are paying monthly, your broker will review your revised billing schedule and discuss your payment options.
2) Take an inventory Moving is a wonderful time to take stock of what you have and edit what you don’t need. The fewer items you have to move, the better. It might even cost you less! Organize things into groups: going to the new home, items that can be donated or taken to waste disposal. While you’re at it, if you don’t have a home inventory it’s the ideal time to create one. Should something ever happen, an inventory can be an invaluable tool for insurance purposes.
READ MORE: Why you need a home inventory
3) Day of the move Some insurance policies will cover your insured location and personal property while you’re in transit, up to 30 days or until the policy expires. Check with your broker to see if this is applicable to your policy. If you’re using a professional moving company, make sure they have their own insurance. Most home insurance policies won’t cover marring, scratching, abrasions, or chipping – so you’ll want the moving company you pick to have an insurance plan that would cover this. In the unfortunate event that there is damage to your possessions and the mover is a member of The Canadian Association of Movers, you can file a complaint. Moving companies are required to have liability coverage for the value of your belongings. The basic liability required by law is only $0.60 per pound per article that is being moved.
4) Storing your possessions If you need to store some of your possessions, talk to your insurance broker to find out if your policy will cover items while in storage. If your storage needs will be long term – 90 days or longer – you can consider a contents in storage policy. If your need is more short-term, most standard home, condo or tenant policies cover items you have in storage – including portable storage containers. They would be covered the same way your belongings at home are and be subject to the same limits.
5) Is moving the best time to shop around? - While many people think of moving as an ideal time to shop around for new policies, you need to be aware if you cancel your insurance policy midterm there will likely be a penalty. Generally, the best practice is to stay with the same insurer before and after your move to ease your transition and avoid a cancellation fee. Use the move as an opportunity to discuss coverage options with your broker while updating your policy for the new home.
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When's the right time to switch insurers?
Bottom line? If you’re thinking of putting your home on the market this season, be sure to keep your insurance broker in the loop.
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