This weekend officially kicks off the start of cottage season. Many of us will be heading north to clean up and open the cabin for the 2024 season. Once you are finished cleaning out the cobwebs and putting the boat in the water, this would be a great time to review your insurance policy to make sure your summer home is properly insured.
While you might think a cottage policy would mirror your primary homeowner’s policy, there are a few big differences. For example, content limits are usually lower at the cottage because most people don’t keep valuables there.
When considering your application insurance companies want to ensure 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. Furthermore, the better shape the property is in, the easier it will be to insure.
Unique Cottage Risks
According to the experts, the most common claims made by cottager owners 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 can sit vacant for long periods.
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. In addition, if you have renters and they use the boat, most policies will not 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. I do not offer this type of insurance myself, but I do know a qualified professional if you need to speak with someone.
Have a great long-weekend,
Tracey & Paige
Products or services related to investments, investment recommendations, financial planning, retirement planning, and investment reviews are provided through our mutual fund dealer Security Financial Services and Investment Corp. 4665 Yonge Street, Suite 309, Toronto, ON M2N 0B4 t 416.964.0440