Common Home and Auto Insurance Situations

If a mishap occurs on your property or while you’re driving, what’s the best way to deal with it? To give you some insight, here are a few common home and auto insurance situations and how to handle them in an effective way.

SITUATION 1

Your Cottage Sustains Damage While Being Rented

Normally, you use your cottage for the entire summer, but this year, you decide to rent it out for a couple of weeks. One afternoon, you answer the phone and hear the panicked voice of the renter. She says that although no one was hurt, the cottage has sustained significant fire damage as a result of a mishap with the barbecue. You later call your insurance representative to make a claim.

Are you covered?

For some cottage owners, a quick and easy way to help cover property tax and maintenance expenses is to rent their vacation property for a few weeks in the summer. If you decide to rent your cottage out, you should advise your insurance representative. Your policy may need to be changed in order to provide you with continued protection. If you fail to notify your insurer, your claim for damages could be denied.

SITUATION 2

You Accidentally Damage a Parked Car

You’re backing your vehicle into a parking spot when you suddenly hear a crunching noise. You accidentally backed into the car behind you! You survey the damage—the parked car has what you consider to be a relatively minor dent. Your vehicle only has a tiny scratch. The driver of the parked car isn’t there and no one else is around.

What should you do next?

For some people, it may be tempting to just leave, but that could result in harsh consequences.

For one, there could have been a witness you didn’t notice, who took down your license plate number and reported the incident to the police. If that were the case, you could be charged with leaving the scene of an accident. This could result in several demerit points being applied to your license as well as a fine for thousands of dollars. Furthermore, your auto insurance rates could substantially increase and your claim for damages to your own vehicle may be denied by the insurer.

If you find yourself in this situation, do your best to find the car owner. Go to any homes or businesses in the area that are in direct view of the accident scene and ask people if they know the owner of the vehicle. If you can’t locate the owner, leave a note with your contact information (name, address, phone number) under the windshield wiper of the car that you hit. It’s also recommended to take pictures of the damaged vehicle, along with the license plate. Also make note of the make, model and colour of the vehicle.

If the note is lost, you will be able to defend yourself against a potential charge for leaving the scene of an accident, as you will have proof that you tried to locate the owner by letting officials know that you canvassed homes or businesses in the area.

You should also keep in mind that most highway traffic or motor vehicle laws require drivers to report any accident involving damage to property exceeding a certain amount to the police (depending on the province you live in, this could range from $1,000 to $2,000).

SITUATION 3

Your Unique Collection is Stolen

Upon arriving home from a weekend get-away, you are shocked to discover that your back door has been smashed open and your home has been burglarized. After the police arrive, you begin to inspect your home. Upon entering the living room, you see that your television and stereo system have been stolen.

Although this is upsetting, you realize that these items can be easily replaced. Your thoughts then drift to something that can’t—your small, but very expensive collection of antique books (appraised at over $20,000). You rush to your upstairs reading room and are distraught when you discover that the entire collection is gone.

Will your insurance cover the cost of replacing the book collection?

Most home insurance policies impose very specific limits (e.g., a maximum of $2,000) on the amount of compensation that can be paid for items such as jewelry, fine art and collectibles. Therefore, unless you had purchased additional coverage for these objects in the form of an endorsement or “rider” to your homeowner’s policy, you would not receive compensation for anywhere near its appraised value.

For no-cost insurance planning advice from licensed, noncommissioned advisors who work exclusively for dental professionals and their families, contact CDSPI Advisory Services Inc. at 1-877-293-9455, extension 5002.

THE AUTHOR

	Ms. Poirier is a professional insurance advisor at CDSPI Advisory Services Inc.

Email: insurance@cdspiadvice.com

CDSPI Home & Auto Insurance is underwritten by The Personal Insurance Company and distributed by CDSPI Advisory Services Inc. This auto insurance is not available to residents of Manitoba, Saskatchewan and British Columbia and this home and auto insurance is not available to residents of Quebec. This information is provided for your general guidance. Precise details, terms, conditions and exclusions are set out in the insurance contract for CDSPI Home & Auto Insurance.