Insuring the Cottage Properly

Now that cottage season is in full swing you may want to double check your policy to make sure you are properly insured.  While you might think a cottage policy would mirror your primary homeowner’s policy, there are a few big differences.  For example, contents limits are usually lower at the cottage because most people don’t keep valuables there.

When considering your application insurance companies want to make sure you are thinking ahead and taking steps to protect your asset.  Your broker may ask you how much you value it, and want to know if you have a property manager or caretaker checking in on the property and maintaining it.

“The better shape the property is in (e.g. the roof is under 15 years, floors are clean, yards are maintained, good quality construction), the easier it is to insure.” Says Andrew Pettipas, broker at J.M. & C.W Hope Grant Insurance.

Unique Cottage Risks

According to the experts, the most common claims made by cottagers are for damage to the property due to wind and fire; or liability claims because of slips and falls.  A hard winter can burst pipes and cause water damage that goes unnoticed for months as cottages sit vacant for long periods of time.

One solution could be to install an alarm system so the property can be monitored year round for fire, burglary and low temperatures.  If there is an emergency, the fire department and police will be notified immediately minimizing the damage. 

If you own a boat, you should know it is considered a separate liability requiring its own insurance. Furthermore, if you have renters and they use the boat, most policies don’t cover that.

Wood-burning stoves are another issue; typically they are freestanding and used to heat the cottage, but if not installed to code; or are not ULC or CFA approved, you will have trouble getting coverage for it.

Other common exclusions in your policy may include wear and tear or deterioration of the building, moving or bulging of the earth/property, damage caused by insects, rodents, birds and vermin, water damage/continual seepage into the cottage and freezing.

Bottom line, the more information you can provide your broker the better he/she can rate it for you and ultimately get you the best coverage.  Make sure you are dealing with a professional insurance broker who is well versed in property and liability insurance and who specializes in the cottage market.

Have a great weekend,

Tracey

 

 

Sources:  original article published on advisor.ca by Suzanne Sharma, 06-28-12.  Credit also to citopbroker.com who published original article