Disaster Insurance

How well are you covered?

If a tree falls on your house, who pays for the damage? This is a question few people can answer without a call to their insurance agent. Yet despite the recent increase in natural disasters, few people have given consideration to their insurance coverage and what compensation is payable should a disaster strike. An “act of God” for example, is perceived by most to be an event that’s not covered by a standard home insurance policy—and something they would have to pay for from their own pocket. But this may not be the case.

So-called acts of God such as wind and hail damage are in fact covered by most home insurance policies. Even earthquake coverage can usually be added to most policies without difficulty.

So what about that fallen tree? Let’s take a look at Joe and Sarah, who return home one windy day to find that a neighbour’s cedar has landed on their roof.

When Joe calls his insurance agent, he is both relieved to learn that his roof and damaged furniture are protected by home insurance coverage—minus his deductible—and surprised that it will be his policy and not his neighbour’s that will cover the loss. Joe’s agent explains to him that, had the tree not fallen down in a wind or other type of storm, and simply fell because it was rotten and/or had been badly maintained, his insurer might go after the neighbour’s insurer in a process known as subrogation. If Joe’s insurer were successful, he would likely be reimbursed his deductible.

Joe made a mental note to sharpen his tools and trim his own trees as soon as the weather improved.

During his chat with the insurance agent, Joe learned that, had his neighbour’s tree fallen on his or Sarah’s car, the damage would be covered by the comprehensive portion of their own auto insurance policy.

The agent also explained that, should the tree have taken down power lines as it fell, Joe and Sarah should never touch electrical wires or household appliances. Instead, they should switch off their circuit breakers or pull out electrical plugs to protect against power surge damage.

How well are you covered? For answers to your home insurance questions, call your London Drugs insurance specialist at: 1-800-681-6677

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