Avoiding Insurance Land Mines
Sometimes, it’s better to take a pass. What you need to know before submitting an insurance claim.
By Michael McCann
About a year ago, a couple my niece knows had their bikes stolen from their apartment, setting off a chain of events that almost led them to losing a home and ending up in court. Upon finding the bikes gone, the couple decided to file an insurance claim, and a cheque was issued for their loss. Not long after, the husband’s prized Ford Mustang was also stolen – which resulted in yet another insurance claim and another cheque.
Feeling they’d had enough of urban life, the couple decided to escape the city. Following a month of searching, they found their dream home and put in an offer. Their sale and purchase agreement contained the usual conditions – financing and inspection. The bank agreed to a mortgage and the home inspection was positive. Waivers were signed, and they now had a firm deal – time to start packing.
To avoid this unfortunate experience, I make three suggestions.
— Before you submit an insurance claim, consider whether the loss is worth it. If you make more than two claims within the same two-year period, it could get you flagged.
— Find out from your insurer whether you qualify for home coverage before making an offer on a house.