How I Saved 25% on Our Home Insurance Policy

Ok, I admit it; I haven’t been keeping on top of some of our “fixed costs” of living. This year, I decided to actually look at the details of our home insurance policy and I’m glad I did: calling in ended up with me saving over 25% a year!

Everyone Should Have Home Insurance Even Those Living in an Apartment

My parents taught me the value of home insurance. When I moved into my first apartment to attend university, I signed up for a tenant’s insurance policy and I’ve stayed insured ever since.

Tenants often think they are covered by the landlord’s insurance policy and to a certain extent they are. If the building is destroyed by a fire, for example, they don’t owe anyone anything. However, if their apartments’ contents go up in smoke, no one is going to pay them back for their loss. They need their own personal tenant insurance if they want to get money to replace their clothes and furnishings.

In some jurisdictions, tenants also need home insurance to cover themselves against being sued for personal liability. I’m not a lawyer and I’m fuzzy on the details, but I believe in some places if a person is calling at a tenant’s apartment, for instance to maintain their salt water aquarium, and that service person gets hurt and sues the tenant for their injury, the tenant would need liability insurance to protect themselves from personally owing money to the tradesperson. Some home insurance policies include this type of liability insurance. Check the details of what coverage you might need to protect yourself with your insurance broker.

There’s an often over-looked advantage to starting insurance as a tenant and student: you can build up a history of claims-free years with your insurance company that can help down the road.

People Running a Home Based Business Need Insurance Too

It’s especially important for people who run a small business from their home to ensure they are adequately insured. You usually need more than a regular tenant or home owner’s policy to be properly protected. Again, speak to your broker. Don’t wait till someone sues you successfully for $500 000 to find out you have no coverage and will be personally responsible for paying that money out of your life savings and future earnings!

How Did I Get a Big Discount and Savings on Our Home Insurance Policy with TD Insurance Meloche Monnex?

Anyway, this January our policy was set to renew. It had gone up again which made me sigh. I’m trying to budget for our future retirement and the steady creep upwards of many of our “fixed costs” of home ownership was worrying me.

The cover letter from TD Insurance Meloche Monnex said our sewer backup coverage has increased significantly. I guess that’s because they realized our part of town is not prone to backups. In fact, our area is quite unlikely to get that kind of flooding due to some natural features of the landscape. Anyway, increased coverage was good especially without an increase in premiums.

The cover letter also said that if we wanted to cut costs we should consider changing our deductible.

I haven’t looked at our home insurance deductible in years. I checked the value of dropping our car insurance deductible a few years ago (which was negligible: they are only worried about what other people might claim from us in an accident not vice versa) but I had never checked on the house.

Whoa. $200! There’s no way I’d put in a claim for $200 against our home insurance.
(And with good reason. If I understood correctly when I phoned in, a claim for any amount against our home insurance could increase our next annual rate at renewal by as much as 25 %!)

So I phoned in to ask what increasing the deductible would do to change our premium, if anything.

How Much Deductible Should I Choose for My Home Insurance?

We’ve paid off our mortgage so the bank has no say in the matter.

We aren’t great believers in “stuff.” Our TV is only a 40 if you measure the screen in cm not inches. And yes, I did say our TV. There’s only one.

We don’t have stereos. We don’t collect precious art. The labels in our clothes mostly say “Marks” or “Northern Reflections.” Our furniture is solid wood mostly made by a fine woodworker who is closely related to us.

Our bikes are Canadian Tire specials. Our cross country skis are over 30 years old and still work just fine. Our skates are well made but have also seen years of hard service.
Our laptop, which is still working very well and travels with us each year, is from 2008.

We’re still working right now so if any of these things needed replacing, we could afford to just buy a replacement.

If a tree fell on the house or car and took out some windows or part of the roof, we could afford to pay for that too.

You can see where this is going. A $200 deductible is ridiculous for us.

We thought a bit about it, and picked a number out of the air. We decided we wouldn’t make a claim for less than $1500 in damage.

Why Did I Get Such a Big Drop in Our Home Insurance Bill?

I wasn’t sure what impact, if any, increasing our home insurance deductible would have on our annual rate. So I phoned in and asked.

To my surprise, the front line agent couldn’t answer the question. Instead, he politely transferred me to the Member Loyalty Department.

That’s where having tenant apartment insurance also played a role. We’ve been with the some insurance, Meloche Monnex, for a zillion years. We haven’t made in claim in over 16 either.

Anyway, when I asked about increasing the deductible from $200 to $1500, our home insurance premium dropped over 25%. That includes a small additional discount for so many years without a claim.

So if your policy is up for renewal, take a look at your deductible. If you wouldn’t make a claim for an amount that low, it may be worth phoning in to ask about raising it!

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Do you remember to keep an eye on your home insurance policy? Have you scored any big discounts? Please share your experiences with a comment.

Checking Into Auto Insurance with TD Meloche Monnex for a New Teenaged Driver

Several of our nieces, nephews and other relatives are approaching that magic age—16—at which they can begin learning to drive legally in Ontario. Hearing the moans and groans of neighbouring parents about car insurance for young drivers, I decided to call TD Meloche Monnex and ask what rates they would charge for a new teenaged driver and when.

What’s the First Level of Driver’s Licence in Ontario?

Ontario uses a graduated licensing program. A new driver learning for the first time usually starts by writing a test on signs and road rules. If they pass with a high enough score they are granted a G1 license. With a G1, a student driver can learn to drive with a licensed, insured driver sitting beside them in the front passenger seat. There are a whole string of other conditions about what times of day they can drive, what roads they can drive on, what amount of alcohol they can have in their blood stream while driving (0!) and so on. Check the MTO website for the current rules and restrictions. They change.

Every driver should, of course, be insured. So I called Monnex to find out what their insurance rules are for new drivers who are the children of insured drivers.

What Does TD Meloche Monnex Charge for the Teenage Child with a G1 of an Insured Driver?

We have our car insurance with TD Meloche Monnex. They’ve been reasonable to deal with and they have a group discount rate for Professional Engineers in Ontario. (PEO members)

So I posed them the theoretical question of: If my child is 16 and passes the written test to get their G1, what do I have to do to insure my child?

I was surprised to learn I just have to phone Monnex and add the child’s name to our policy. There is no annual fee for us to have a child student driver added to our policy! No wonder some parents are not in a rush for their child to take their G2 road test.

What’s the Second Level of Driver’s Licence in Ontario?

After learning to drive, and after practicing for one year, a student driver can take the road test to upgrade their license to the second level. If they pass the test they will be granted a G2.

The student can take the G2 test a bit earlier if they take a Driver’s Education course approved by the Ministry of Transportation of Ontario.

I found it interesting that the government is actually listing driver’s education companies to avoid. They provide a list of “Unlicensed driving schools to avoid.”

What Does TD Meloche Monnex Charge for the Teenage Child with a G2 of an Insured Driver ?

We have our insurance with Monnex. We would want to add our child to our policy when they earn their G2.

Monnex wasn’t keen to quote me a rate yet, since this is years in advance. They did say the rate will depend on many factors. It could be around $1200/year for a driver in the GTA.

I mentioned that the driver would be one of three people in a household with only two licensed vehicles. In that case, the agent said the insurance will be more likely to be in the range of $400-800 per year.

Does TD Meloche Monnex Offer an Insurance Discount for G2 Drivers With Driver’s Education and for How Long?

I asked if our child took driver’s ed from, say, Young Drivers of Canada, would it affect the premium.

The agent said generally having drivers’ education from an approved school would reduce the insurance cost by about 5% a year.

The discount would apply for three years after the driver gets their G2 license.

What’s the Third Level of Driver’s Licence in Ontario?

Most drivers will take an “exit test” a year after getting their G2 license in Ontario. This is another more complicated road test. If they pass it, they are granted a full G class driver’s licence. That’s the usual licence us “old folks” have had for years.

What Happens to Our Child’s Car Insurance Rate Once They Get Their G1 License?

That was so far out in the future that the agent wouldn’t quote me a rate. I’ll have to write about that if and when any of our children grow up enough to get their licence so it will be a few years! If your own child has already reached this stage, please leave a comment with any info about insurance costs. I’m sure other readers will appreciate it!

For now, we have nothing to worry about. Our children aren’t old enough to be a menace on the highways, yet. When they are, however, it looks like we’ll have to add a few more thousand to our annual budget.

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Do you have a young driver in your household? Has car insurance been reasonable or a killer? Please share your experiences with a comment.