DMW Insurance Ltd., an experienced insurance brokerage serving the Toronto, Ontario area, wants to educate homeowners on the importance of insuring their homes for more than the amount they paid for them.
DMW Insurance recognizes the need to educate homeowners on why their homes should be insured for more than the amount they paid at the time of sale. Homeowners may assume their basic home insurance policies will cover any type of damage, no matter how great the loss. What many don't realize is that rebuilding after significant damage can cost much more than the market value of a home. Making sure the home is adequately insured can prevent major property loss.
Many homeowners might want to know why it's so important to insure their homes for more than the property value at the time of sale. In most cases, basic home insurance is bought to cover the value of the owners' personal items, and occasional damage such as a storm knocking down a fence, or a burst water pipe. However, in the event of a fire, flood, or other disaster that results in catastrophic damage, the urgency to rebuild can result in labor and materials costing much more than the original price of the home. Widespread news coverage of the past few years shows a tragic amount of families losing their homes to severe storms, earthquakes, and wildfire, and DMW is recognizing the need to further educate their clients on this topic so they're prepared in the unforeseen event that a disaster strikes their home.
Updated and more stringent building codes might also drive up the reconstruction costs, as well as those from demolition and debris removal. A contractor's access to the property can become a problem when landscaping, fencing, and neighboring property make it difficult for equipment to be brought or stored close to the site. In some cases, collateral damage may be necessary in order for the contractor to access the home to make the necessary repairs. All of these factors can raise the costs of rebuilding.
With a major project, these costs can quickly rise to more than the value of the home, and exceed the current home insurance's coverage limits. If a home is insufficiently covered, these additional costs that add up can be more than the homeowners can afford to make, even if a claim is paid up to the point of their current insurance coverage. This type of scenario can result in the homeowners tragically losing not only their home, but their investment.
Homeowners should invest in Guaranteed Replacement Cost coverage and re-evaluate their home's replacement cost every five years. It's also a good idea to re-evaluate after any renovation, addition, or upgrade. DMW Insurance strives to protect individuals, families, and businesses from the devastating financial impact that can result from being under-insured in the event of a total property loss.
Homeowners in the Toronto area who are interested in learning more should contact a DMW agent at http://www.dmwinsuranceltd.com.