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Why do home insurance rates increase & how can you save on your home insurance ?

January 14, 2021

With insurance rates on the rise across the country, it’s important to realize there are many elements that contribute to these increases. Whether you’re purchasing a new policy or renewing an existing one, these insights will help you understand how your rates are calculated. You can also find more information and save on your home insurance at mcdermottinsurance.ca

HOME INSURANCE TOP REASONS FOR RATE INCREASES

Extreme weather events and catastrophes are more frequent

As floods, forest fires, storms and other weather events become more common, they cause extensive damage. This results in more costly claims. For more information on catastrophic losses in Canada, click here.

MUNICIPAL INFRASTRUCTURE IS OLD

A higher demand for water and outdated municipal infrastructure make for more frequent sewer backups. These are causing higher damage-related claims.

NEIGHBOURHOOD TRENDS MIGHT PUT YOU AT GREATER RISK

As neighbourhoods grow, demographics and risks change. For example, if there is a new commercial development near your home, or if a new subdivision emerges, this might alter municipal infrastructure. These are factors insurers look at when assessing risk.

EMERGENCY SERVICES, SKILLED TRADES AND PERSONAL BELONGINGS ARE MORE EXPENSIVE

Inflation to goods and services means higher prices for things like labour costs for repairs and emergency services. This means claims payments become more expensive, too.

NEW FEATURES ARE ECO-FRIENDLY, BUT NOT BUDGET-FRIENDLY

Solar panels, energy-efficient doors and windows, high-efficient appliances are all good choices for our environment, however, if damaged, they could be more expensive to repair or replace.

MODERN HOMES COST MORE

Home prices rising, high-end features like hot tubs and pools can drive up replacement costs and liability claims.

FINISHED BASEMENTS NEED MORE COVERAGE

Finished basements cost more to repair, if there’s a sewer backup or other damage, due to higher-priced building materials.

HOW TO SAVE ON YOUR HOME INSURANCE

Although costs are rising, there are way to save premium dollars

  • Higher deductible
  • Claims free discount
  • Renewal discount
  • Multi-policy discount

Ask our Brokers about the methods available to you at mcdermottinsurance.ca

Contact one of our brokers for more information

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