Which of the following would be covered under Coverage C of a dwelling policy?
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Homeowners coverage provides financial protection against loss due to disasters, theft and accidents. Most standard policies include four essential types of coverage: coverage for the structure of your home; coverage for your personal belongings; liability protection; coverage for additional living expenses Show
Coverage for the structure of your homeYour homeowners policy pays to repair or rebuild your home if it is damaged or destroyed by fire, hurricane, hail, lightning or other disasters listed in your policy. Most policies also cover detached structures such as a garage, tool shed or gazebo—generally for about 10 percent of the amount of insurance you have on the structure of the house. A standard policy will not pay for damage caused by a flood, earthquake or routine wear and tear. When purchasing coverage for the structure of your home, remember this simple guideline: Purchase enough coverage to rebuild your home. Coverage for your personal belongingsYour furniture, clothes, sports equipment and other personal items are covered if they are stolen or destroyed by fire, hurricane or other insured disasters. The coverage is generally 50 to 70 percent of the insurance you have on the structure of the house. The best way to determine if this is enough coverage is to conduct a home inventory. Personal belongings coverage includes items stored off-premises—this means you are covered anywhere in the world. Some companies limit the amount to 10 percent of the amount of insurance you have for your possessions. You also have up to $500 of coverage for unauthorized use of your credit cards. Expensive items like jewelry, furs, art, collectibles and silverware are covered, but there are usually dollar limits if they are stolen. To insure these items to their full value, purchase a special personal property endorsement or floater and insure the item for its officially appraised value. Trees, plants and shrubs are also covered under standard homeowners insurance—generally for about $500 per item. Trees and plants are not covered for disease, or if they have been poorly maintained. Liability protectionLiability covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. It also pays for damage caused by your pets. So, if your son, daughter (or even your dog) accidentally ruins a neighbor’s expensive rug, you are covered. (However, if they destroy your rug, you’re out of luck.) The liability portion of your policy pays for both the cost of defending you in court and any court awards—up to the limit stated in your policy documents. Liability limits generally start at about $100,000, however, it’s a good idea to discuss whether you should purchase a higher level of protection with your insurance professional. If you have significant assets and want more coverage than is available under your homeowners policy, consider purchasing an umbrella or excess liability policy, which provides broader coverage and higher liability limits. Your policy also provides no-fault medical coverage, so if a friend or neighbor is injured in your home, he or she can simply submit medical bills to your insurance company. This way, expenses can be paid without a liability claim being filed against you. It does not, however, pay the medical bills for your own family or your pet. Additional living expenses (ALE)ALE pays the additional costs of living away from home if you cannot live there due to damage from a an insured disaster. It covers hotel bills, restaurant meals and other costs, over and above your usual living expenses, incurred while your home is being rebuilt. Keep in mind that the ALE coverage in your homeowners policy has limits—and some policies include a time limitation. However, these limits are separate from the amount available to rebuild or repair your home. Even if you use up your ALE your insurance company will still pay the full cost of rebuilding your home up to the policy limit. If you rent out part of your house, ALE also covers you for the rent that you would have collected from your tenant if your home had not been destroyed. Next steps: Purchasing a home? Get the Home Buyers Insurance Checklist. What is Coverage C?Most home insurance policies in Canada are based on the standard homeowner’s forms from the Insurance Bureau of Canada, or IBC. The standard homeowner’s forms divide home insurance into seven different coverages, designated A through G. Many policies keep this naming scheme, so you may see them in your own policy wordings. Coverage C is for personal property, also known as contents. Personal property refers to real, moveable stuff that you own. Furniture, appliances, clothing, electronics, and jewellery are all examples of personal property. Though many policies refer to this coverage as Coverage C, the name isn’t universal. Square One, for example, doesn’t refer to our coverages using the A through G system. Instead, Square One policyholders can find their contents coverage within Section 3 – Property Coverages. What is covered under Coverage C?Coverage C protects the insured’s personal property, which is often called contents (because it makes up the “contents” of the home). The definition of personal property is extensive, and accordingly, so is the protection offered under Coverage C. Almost any tangible item that’s not permanently fixed to the building or the ground would fall under Coverage C. That isn’t to say that Coverage C automatically covers everything the insured owns. As with any insurance, there are conditions and exclusions which vary from insurer to insurer. Many insurers use the IBC form that we’re talking about here only as a starting point. Make sure you check your policy wordings or ask your insurer about how your personal property is insured. Coverage C exclusionsCoverage C protects all the insured’s personal property, except for the following:
What does “and their equipment” mean? IBC’s Coverage C explains equipment as “audio, visual, recording or transmitting equipment powered by the electrical system of a motor vehicle or aircraft.” So, no coverage for car stereo systems, radar detectors, dash cams, or similar stuff that’s powered by the vehicle. Coverage C special limitsSome specialty items aren’t excluded from coverage, but are subject to separate limits of insurance. From the insurer side, the rationale is that some of these items can be very, very expensive, but not everyone owns them. It would be unfair for everyone to pay higher premiums to cover the cost of just a few people’s precious jewellery. So, standard coverage includes only a small amount for jewellery, and people with expensive pieces have the option to add more coverage if they wish. Example Tina has a home insurance policy with a limit of $35,000 for her personal property coverage. Her Coverage C places a limit of $500 on jewellery, but she has a ring that’s been appraised at $1,500. Tina wears it every day and feels like it could never be lost or stolen. Unfortunately, she is wrong; one day her ring is stolen. Her insurer can only offer her up to $500 to cover the ring, even though she has $35,000 in coverage for personal property and an appraisal document saying it’s worth $1,500. The standard form includes the following special limits:
Note that each of these limits is per occurrence and not per item. If you (for some reason) have three tractors worth $5,000 each, and they all get stolen at once, you’ll still be limited to just $5,000 in coverage. There are a few more special limits in Coverage C that apply only when the items are stolen:
For example, if someone steals your bicycle, coverage is limited to $500. If your bicycle burns in a house fire, no special limit will apply; the bike will be included in your total personal property limit. Special limits are one part of the standard homeowner’s form that insurers are very likely to tinker with. Your policy almost definitely has different special limits, so make sure to review your policy wordings. Special limits are one of the things that Square One does very differently, but we’ll get to that shortly. It only takes 5 minutes ready for an online quote? Policies start at $12/month if you rent your home and $40/month if you own your home. To see how much you can save with Square One, get a personalized online quote now. Can I increase my special limits?If you own property whose value exceeds your policy’s special limits, you can always ask your insurer to add an endorsement that grants extra coverage for your valuable property above the special limit. Insurers will have no problem increasing limits for most property (for a higher premium, of course). At which locations is personal property covered?Coverage C protects the contents of the insured’s home. The property of roomers or boarders is not covered (they need a tenant insurance policy). As long as stuff is located at the insured premises, it falls under Coverage C. But it goes even further. Home insurance also provides coverage for personal property when it’s temporarily removed from the premises, anywhere in the world. So if you take your stuff on vacation, it’s still covered by your home insurance—subject to the usual exclusions. The key here is temporarily removed. If stuff is removed permanently, for example, stored at a vacation home, it isn’t covered; it needs a different insurance policy for the second location. Coverage C also protects the possessions of students who are temporarily living away from home while attending school, subject to the special limit mentioned above. How is Square One’s personal property coverage different?Square One doesn’t use the typical system of special limits. Instead, we make specialty property insurance completely optional. We don’t think it’s necessary to have people pay to insure things they don’t own, even with small limits. We divide specialty property into the following categories:
All four of these categories are excluded from our policies by default. If you own property in one or more of the categories, adding coverage is as easy as typing in an extra number on your policy application. For big-budget items, we might ask for an appraisal or receipt, but for the most part, adding specialty property coverage is effortless. The important points
Looking for another insurance definition? Look it up in The Insurance Glossary, home to dozens of easy-to-follow definitions for the most common insurance terms. Or, get an online quote in under 5 minutes and find out how affordable personalized home insurance can be. About the expert: Stefan Tirschler Stefan is responsible for underwriting leadership, market expansion, and product research and development for Square One's operations. Stefan has earned his Fellow Chartered Insurance Professional designation, and maintains a level 2 general insurance license in British Columbia, Alberta, Saskatchewan, Manitoba and Ontario. Stefan is also an Education Committee member and CIP/GIE instructor for the Insurance Institute of Canada. Get a free quoteGet a personalized online home insurance quote in just 5 minutes and see how much money you can save by switching to Square One. Get an online quote now Protect your familyEven when you take precautions, accidents can happen. Home insurance is one way to protect your family against financial losses from accidents. And, home insurance can start from as little as $12/month. Learn more Which of the following is not covered under Coverage C?Coverage C protects all the insured's personal property, except for the following: Motor vehicles and their equipment. Cars have their own insurance policies, so home insurance excludes them. Coverage C usually does, however, insure ordinary home maintenance vehicles like lawnmowers or snowblowers.
Which of the following is not covered by a dwelling policy?Damage Caused to Detached Structures on Your Property — Dwelling insurance doesn't cover damage caused to structures separate from your house, such as sheds, fences, barns, and carports.
Which of the following is covered under a dwelling policy?Most homeowners insurance policies cover the following perils under dwelling coverage: Theft. Vandalism. Fire and smoke damage.
What is the percentage of coverage C?Coverage C: Personal Property
Coverage Amount (as a percentage of Coverage A) 25% included Yes, Coverage C is available from a minimum 25% to maximum 50%; or the coverage may be excluded (0%).
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