As taxes and other expenses for cottages continue to increase, many cottage owners are looking for creative ways to soften these costs. This has motivated some cottage owners to rent out the cottage on a weekly basis during peak season when the cottage is not in use.
However, it is vital that your insurance provider is aware of your decision to rent out your cottage beforehand.
Failing to notify your insurer may cause a material change in risk resulting in a claim being denied. Many insurance companies will permit your cottage to be leased up to 4 weeks a year with an additional charge for the increased liability exposure.
If more than 4 weeks a year is required or your present insurance company cannot accommodate this liability, we may need to change your policy to a business policy.
In these circumstances, it will be important to review with your broker what coverage changes are required. Another important consideration will be any additional services you may be providing.
Do you have a boat that will be used with the cottage rental?
Your insurance company may accept the risk with a boat of lower horse power and a reasonable maximum speed. However, they may not accept the risk with a higher horsepower capable of higher speeds, as this increases the liability exposure.
We will be happy to discuss all of your concerns and provide you with options to allow you to rent out your cottage without jeopardizing your insurance protection.
At first blush, Ontario’s no-fault auto insurance system doesn’t live up to its name. The idea is not that no one is at-fault when you are involved in an accident, as the name suggests.
Rather, the system is designed so you deal directly with your insurance company for compensation—not the at-fault driver—when you are injured or your car is damaged.
The same concept applies to passengers in your car at the time of an accident. If they are injured, they seek compensation through their auto insurance policy, not yours. An exception to this rule is when your passengers do not have coverage. In that case, your insurance company may compensate them for their injuries.
Likewise, the driver of the other vehicle involved in the accident files a claim with his or her insurance company.
HOW DO NO-FAULT INSURANCE CLAIMS WORK?
Once you file a claim with your insurer, Ontario law requires them to assign a percentage of fault to each driver involved using the Fault Determination Rules. These rules were drafted in 1990 as regulations under the Insurance Act to help auto insurance companies process claims more quickly and cost-effectively. They are completely separate from any traffic charges the police might file against you under the Highway Traffic Act.
Based on these rules, your insurer may find that you are partially, fully, or not at-fault.
HOW EXACTLY IS FAULT DETERMINED?
Let’s say you are driving in icy conditions and are unable to stop your car in time. As a result, you hit the back of another vehicle. The police takes into account the weather condition and let you go without filing charges. To cover damages to your vehicle, you file a claim with your auto insurance and they apply the Fault Determination Rules, which state that a driver that rear-ends another car is automatically at-fault no matter what the road conditions may be (or whether they were charged by police).
The deductible you pay will be determined by the percentage of fault your insurance company assigns to you, and your premiums may increase on your next policy renewal if you are found to be partly or fully at-fault.
WHAT IF I DISAGREE WITH MY INSURER’S FAULT DETERMINATION?
If you disagree with the percentage of fault assigned to you, you may file a consumer complaint with your insurance company’s Ombudsman Liaison Officer. If the complaint is not resolved to your satisfaction, you can contact the Ontario Insurance Ombudsman or take the matter to court.
WHO IS AT-FAULT IS NOT ALWAYS SELF-EVIDENT
For example, you could be stopped behind another vehicle at a red light. The driver in front of you realizes he is interfering with the pedestrian crossing, backs up his vehicle a couple of feet ….. and forgets to switch gears back to ‘drive’. So, when the light turns green, he backs into your vehicle.
Unfortunately, the person may try to shift the blame and reports that YOU rear-ended his vehicle. In cases like this, it is crucial to gather as much information as possible at the scene of the accident, including videos, photos and witnesses.
If you think having your home flooded with water is bad, just imagine if it were sewage.
A mainline backwater valve is placed directly into the sewer lateral at the foot of your basement wall. The device allows sewage to flow in only one direction – out of your house. When sewage begins to move toward your basement, the valve closes.
This valve is installed directly into the sanitary sewer lateral, and serves to protect all home plumbing fixtures from sewer backup.
Make sure you install the type of valve recommended by your municipality. In most cases they require the normally open (or open-port) mainline backwater valve. This valve is installed directly into the sanitary sewer lateral, and serves to protect all home plumbing fixtures from sewer backup.
Installation of the backwater valve may reduce the cost of insurance or be required as a condition of insurability.
WHEN INSTALLING BACKWATER VALVES:
The valve should be installed based on the manufacturer’s installation instructions, which have specifications for placement and grading. Proper placement and installation of the backwater valve is extremely important. If placed in the wrong location relative to other plumbing fixtures on the sanitary lateral, the valve could be bypassed and provide no protection. This can in turn lead to sewer backup pressure which can cause cracks to the basement floor and lead to flooding.
If the weeping tiles are still connected to the sanitary sewer lateral downstream of the valve, sewage could be forced back into the weeping tiles and lead to structural damage to the foundation, which can also lead to infiltration flooding.
Like other parts of your home, backwater valves require periodic maintenance to ensure proper performance. An improperly maintained valve may fail during a flood. Most mainline backwater valves come with a see-through top so you can check to see if it is clogged with debris.
The valve should be checked regularly to ensure that it will function properly when it is needed. You will likely need the help of a qualified plumber to carry out maintenance of the valve.
After a backwater valve has been installed do not use plumbing, such as flushing toilets, running dishwashers, washing machines, or running taps, etc. during intense rainfall. If the home plumbing is used when the backwater valve is closed, water will have no way to exit your home until the valve has reopened.
If you’re not sure if the valve is closed, check it – you should be able to see it through the clear, plastic top.
If you lost everything you own in a fire tonight, would your current homeowners insurance be enough to cover your total loss?
Chances are, if you are like a number of homeowners, it will not.
Sadly, many people miscalculate the value of their possessions and are left frustrated when a tragedy happens.
By taking the steps outlined below you can have peace of mind that, if something unfortunate ever occurs, you have an accurate inventory of all your belongings and have enough coverage to replace them.
KEEP AN INVENTORY LIST
Catalog your possessions and what they are worth. Six easy ways to keep an accurate record include:
Snap a photo — smart phones and digital cameras make this easy.
Take a video tour — use the video on your smart phone or camcorder to capture your belongings room by room.
Write down the details — support your visual record with a written list that offers details on serial numbers, make, model and any other pertinent information.
Save receipts for high-dollar purchases.
Update your list annually and when you make a major purchase.
Keep your inventory records in a safety deposit box or other secure location outside your home.
You could use an app called Evernote to accomplish all of the above.
Update your inventory list on your annual policy renewal date.
CHECK YOUR COVERAGE
If anything is certain it’s that things change. The initial limit you selected for your insurance policy was based on the belongings you had at that time.
Ask yourself these five questions when checking your coverage:
Would the estimated value shown on your policy pay to replace everything in your home today?
Have you taken into account the cost to replace your items at current prices?
Have you included the cost to replace less obvious things like clothes, kitchen appliances and tools, air purifiers, portable electronics (tablets, MP3 players, laptops, gaming consoles and accessories) and furniture?
Have you factored in the cost to replace antiques and other unique valuables? If so, be sure to add them to your policy with a certificate of appraisal.
Does your policy have coverage limits for computers, bikes or jewellery? If these limits do not cover your items, talk to your insurance broker about adding options that protect you.
While it is tempting to save money on premiums by reducing your coverage, doing so can end up costing you more if a tragedy occurs that results in the loss of all your possessions. It is worth spending the extra few dollars each month to ensure you have adequate coverage when it counts.
Include taxes when you update your inventory.
Change your policy immediately if the value of your belongings is greater than the value listed on your policy.
Do not over-insure or under-insure your possessions.
LET’S SAY YOU OWN A RESTAURANT AND SUFFER A FIRE LOSS. YOU ARE FORCED TO CLOSE FOR TWO MONTHS TO MAKE REPAIRS AND THEN YOU FIND IT TAKES ANOTHER TWO MONTHS BEFORE YOUR BUSINESS RETURNS TO ITS NORMAL LEVEL. HOW CAN YOU PROTECT YOUR PROPERTY AND YOUR BUSINESS?
In this situation, your property policy pays to repair the building and replace your contents.
Your business losses (loss of income) are covered depending on the type of Business Interruption Insurance you’ve chosen.
If you have Gross ProfitsInsurance, your loss of income is paid while closed for repairs and while you rebuild your business to its original level, up to the limit of coverage.
On the other hand, Gross Earnings Insurance only covers the income lost during the time required to repair the premises.
If you own rental income property, you also have two choices for Business Interruption Insurance.
Gross Rentals Insurance acts on the same basis as Gross Profit Insurance. If your apartment building suffered a fire, your Gross Rentals Insurance will pay for the loss of income during the repair period and for lost income during the time it take to rent all of the damaged apartments up to the limit of coverage.
Whether your business is retail, restaurant, manufacturing or rental properties, we can offer the appropriate Business Interruption Insurance to protect you from loss of income. Call us to get started.