Purchasing a new home involves a serious financial commitment. Most Canadians channel their lifetime savings or acquire loans to purchase their dream home.
Now that you have purchased your home, would it be wise to leave it susceptible to damage or destruction? What if you find your home uninhabitable due to some calamity in a couple of months?
According to the Insurance Bureau of Canada, weather events in 2018 inflicted damages worth more than $1.9 billion. Floods, fires, explosions, theft, and civil unrest are perils that render your home susceptible to damage.
Whether you have just purchased your new home or have been a property owner for a long time, insuring your property continues to be a priority.
Wondering what happens if you don’t have home insurance? We have explained the potential fallouts of overlooking such policies. You can also find more information about reputed insurance brokers like Surex, who can help you with affordable insurance quotes.
What Is a Home Insurance Policy?
A home insurance policy is a form of financial security that compensates you for damages to your home arising from natural or artificial causes.
Apart from the structure of your home, some policies also cover your belongings or the contents of your home. In case of damage, theft, or loss of property, you can file a claim and get compensation.
You can also protect elements lying outside your home through these policies. These include patios, decks, and other structures on your property. If a peril renders your home uninhabitable, the policy would also provide you with financial support for renting hotel rooms.
Homeowner’s insurance is different from tenant insurance, and the scope of coverage is somewhat overlapping. If you rent out your property, ensure that you have homeowner’s insurance while your tenant gets a separate policy.
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Can You Purchase a Property Without Insuring It?
Yes, homeowners have the scope to overlook property insurance altogether. However, this wouldn’t be wise as you won’t have any kind of protection to secure the property.
For most Canadians, purchasing a property happens to be the single-largest investment of their lifetime. Wouldn’t it be prudent to have adequate coverage to protect yourself financially?
Although having property insurance isn’t mandatory in Canada, you might need one if you’re putting your home up for a mortgage. Your insurance continues to be the security for the bank against perils damaging the property while it’s on a mortgage.
What Happens If You Have No Home Insurance?
Your home insurance policy secures your property and its contents from any kind of damage or loss. With adequate insurance, you have the much-needed financial cushion in times of misfortune.
Let’s talk about the possible implications if you have no home insurance.
1. Your Property Remains Unprotected
Many Canadians fail to understand the true value of a home insurance policy. The benefits lie beyond the structural coverage of your property. You can also protect your expensive apparel, electronic appliances, furniture, and jewelry with the right policy.
If you have no home insurance, these valuables remain susceptible to vandalism, theft, natural calamities, and electrical fires.
2. Zero Liability Coverage
Suppose you have got some visitors at your home, and someone slips and falls down the stairs. Or a branch in your garden comes crashing down on one of your guests. Who would bear the liability to cover the legal and medical expenses for treatment?
You get this kind of liability coverage with a home insurance policy. In case someone on your property sustains fatal injury, the expenses can rob you of your financial stature.
You would be ridden with legal defense charges and treatment costs. With homeowner’s insurance, you remain cushioned against these unforeseen expenses.
3. Difficulty In Mortgaging
If you try to obtain a mortgage loan, your lender would want you to cover the property. In case of lighting, hailstorms, floods, theft, hurricanes, electrical fires, or structural damage, the lender would remain protected against possible losses. Having home insurance ensures faster mortgage processing and easier loan availability.
4. No Protection for Detached Elements
Have you thought of protecting the detached elements of your house? What if severe weather conditions damage your garage or shed? After all, you had already incurred expenses while installing these structures.
So, it would be wise to protect these detached elements. Unless the damage occurs due to normal wear and tear, you will receive compensation following an incident.
Does Property Insurance Cover Pest Damage?
It’s easy to assume that having a home insurance policy would secure you against all sorts of losses in your home. However, it pays to understand that this differs from a maintenance plan.
In case you fail to hire pest control professionals to protect your property from termites, ants, spiders, or any other pest, your property insurer won’t cover the damage.
In the event of a pest infestation, make sure to reach out to a pest inspection company. In Canada, you have different types of termites that feed on wood. So, failing to detect an infestation early on can lead to severe damage.
Termites often eat up your home’s wooden components, causing structural integrity loss. As a homeowner, you must schedule timely inspections to detect pests.
What Happens If You Don’t Have Home Insurance in Canada? — Endnote
Legally, you aren’t required to purchase a home insurance policy in Canada.
So, if you are wondering, ‘What happens if you don’t have home insurance?’, you need to consider the financial losses you would bear in the case of an incident.
It’s in your financial interest to get property insurance. Unforeseen events can ruin you financially in the absence of a home insurance policy. If you are a tenant, it’s wise to go for a tenant’s or renter’s insurance.
Even though your landlord has a homeowner’s insurance policy, it won’t protect your belongings. It would be wise to consult a reputed insurance advisor like Surex and purchase your policy.
With proper coverage for your property, you will cherish your mental peace being financial security. With professional support, you can narrow down your options and choose from several affordable policies.
