Unlike car insurance, home insurance is neither necessitated by law nor mandated by any association. Instead, it is a quality investment that covers the most significant investment of your life – your home. In the case of any theft or damage to the property, the home insurance backs you financially.
However, some lenders make home insurance a compulsion while lending a mortgage. Home insurance in Alberta is costly compared to other provinces in Canada. As per trends, home insurance costs in Alberta will rise by roughly 5% by the end of 2022. Homeowners that want to save on coverage can get home insurance quotes in Alberta from Surex for the best deals on top-rated home insurance products.
Read on to learn the answer to the question, “how much is home insurance Alberta?”.
How Much is Home Insurance in Alberta in 2022?
So, how much does home insurance cost in Alberta?
The average home insurance cost in Alberta is approximately $1,000 per year. This is higher compared to the national average of $960. Only a few provinces in Canada have average home insurance prices greater than $1,000. However, this figure is indicative. It can further go up or down depending on several factors, such as the house’s location.
So, why is home insurance costly in Alberta? Let us find out.
Home Insurance Trend in Alberta
In Canada, Alberta has seen the most dramatic growth in home insurance rates. Over ten years, the cost of home insurance has grown by approximately 140 percent. This is much higher than the overall inflation rate in Canada (17%) in the past decade.
The growth in home insurance rates is attributable to an increase in property insurance claims due to climate change. According to the Insurance Bureau of Canada, there has been a dramatic increase in the property claims trend. It has almost tripled from $2.3 billion in 1996 to $7.2 billion in 2021.
Why is the Average House Insurance Cost in Alberta High?
Alberta’s average house insurance cost is high due to its weather, climate, and demographics. Particularly, the weather in Alberta is more adverse than in other provinces. For instance, Alberta has witnessed floods in 2013, the Forts McMurray Wildfires of 2016, several high-intensity hailstorms, and thunderstorms.
It means homes in Alberta are more prone to damage than in other provinces. So, insurance companies consider homes in Alberta as high-risk. As a result, the home insurance cost is higher in Alberta.
Apart from this, other factors that determine the cost of home insurance in Alberta are:
- Replacement cost
- Type of property
- Any past claims
- Credit score
- Location of the property
- Special use
- Quality and condition of the roof
- Security features like fire alarms and anti-theft systems
- Internal construction
- The presence of a pool
Types of Home Insurance in Alberta
- Property: This coverage provides protection to your homes from calamities such as fires and floods. Primarily, the coverage cost is based upon the home’s replacement cost and not on the market value. The exterior structures like driveway and fences are included under this coverage. However, the detached structures might need additional coverage.
- Contents and personal property: This coverage protects your contents and personal belongings inside your home. It covers bicycles, appliances, furniture, laptops, etc.
- Additional living expenses: This covers the additional living costs like the housing costs when you and your family need to stay at a hotel temporarily because of ongoing home repairs.
- Personal liability: This coverage offers protection when someone gets injured on your property and files a lawsuit against you. Most home insurance policies are basic, broad, or comprehensive and provide personal liability coverage.
- Voluntary medical payment: This covers doctor’s visits or surgeries for up to one year from the date of an accident when someone gets injured on your property and requires immediate medical attention.
- Voluntary property damage: This coverage protects you and your family when unintentional damage is caused to someone else’s property.
What Isn’t Covered Under a Standard Home Policy in Alberta?
Any mortgage payments or property taxes aren’t covered under a standard home insurance policy in Alberta. Most insurers even exclude some natural calamities such as floods and landslides. In this case, homeowners may have to buy separate insurance coverages, commonly referred to as add-ons or endorsements.
Similarly, some of the detached exterior structures built onto your property are also not covered. Therefore, it is highly advisable to read the policy thoroughly and seek further information from your insurer.
Home Insurance Tips for Homeowners
Most of the towns and cities in Alberta are prone to flooding. Therefore, it is important to check whether or not your insurance policy covers the overland floods. If flooding isn’t covered under your home insurance policy, talk to your insurance broker about getting an add-on to safeguard your home against this calamity.
After witnessing Alberta’s wildfires in 2016, the property owners are very much concerned regarding wildfires. Though most of Alberta’s standard home insurance policy protects against wildfires, check for limits. If the amount covered against these disasters is insufficient, don’t hesitate to purchase additional coverage.
It is important to shop around for a policy that provides coverage for sewage systems as only some insurers cover sewage and plumbing systems. It provides protection to your property against any sort of plumbing or sewage-related accidents.
Some places are highly susceptible to storms and tornadoes.
Homeowners witness around 16 tornadoes every year. Taking into consideration the dangers involved, shop around for the policy that provides protection against storms and tornadoes.
Alberta homeowners have witnessed wildfires, floods, and tornadoes but, so far, haven’t experienced earthquakes. So, you may skip earthquake coverage and save on your insurance premiums.
Whether you are purchasing a new dwelling or trying to qualify for a mortgage, home insurance is a necessity. However, no law mandates homeowners to purchase home insurance. But, it is a smart move to protect your most significant investment from uncertainties.
Although the benefits are countless, complex terms and legal jargon make it difficult to compare the home insurance quotes. Therefore, it is advisable to consult a reputed insurance broker to get personalized advice. Lastly, compare and shop around to get the best home insurance for the most competitive price.