Canadian Underwriter

Commonwell Mutual Insurance Group offers new flood policy endorsement for Ontario homeowners

February 13, 2017   by Canadian Underwriter

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Commonwell Mutual Insurance Group has a new policy endorsement that uses geo-coding to provide Ontario homeowners in low- and medium-risk zones with protection against property damage from flooding, surface water and sewer back-up caused by flood events.

River flooding its bankStarting Feb. 13, Water Plus will be available to eligible homeowners, tenants and condo owners through the insurer’s partnered brokers and agents.

Launched in advance of flood season with the sprint thaw, the offering takes a different approach by scaling across Ontario by zones of low-, medium- and high-risk flood activity, notes a company press release issued Monday.

Use of third-party analytics employing precise geocoding will “eliminate all guesswork in evaluating a homeowner’s flood risk and maximize coverage” for policyholders, reports Commonwell Mutual Insurance Group, established Jan. 1, 2014 with the merger of three longstanding mutual insurance companies.

Related: Three Ontario mutual insurance firms approved for amalgamation

Key features of the policy endorsement include the following:

  • coverage triggered by flood, surface water and sewer/sump back-up (when caused by flood or surface waters);
  • mitigation coverage included up to $1,000;
  • renewal flow-through for the majority of eligible policyholders;
  • Water Plus is read-in for eligible policyholders (low and medium zones);
  • deductibles follow the package-base deductible rate; and
  • optional increased deductibles are available.

Most of the insurer’s existing policyholders are in low-risk zones, the statement notes, adding that the endorsement is read-in at policy limits at no charge.

Related: Ontario’s The Commonwell Mutual Insurance Group launches two seasonal homeowner products

“Policyholders in medium-risk zones will have coverage at a $10,000 limit read-in at no charge (with higher limits available),” the insurer explains, while those in high-risk zones are not eligible to receive the coverage at this time.

That said, all zones “have access to Additional Water Escape Endorsement, which covers sewer back-up protection,” Commonwell Mutual Insurance Group adds.

Related: Geocoding precision key to accurately estimating potential flood losses

Pointing out that many insurers use postal code as part of their flood models, the insurer notes a precise geo-coding approach will help ensure “coverage to as many existing and prospective policyholders as possible.”

With rivers, lakes and streams making up much of the geography served by Commonwell Mutual Insurance Group, the statement adds, “utilizing postal code flood modelling was too exclusionary.”

The idea behind the offering was to “create a complete solution for flood coverage that would be accessible to as many customers as possible,” Tim Shauf, president and CEO of The Commonwell Mutual Insurance Group, says in the statement.

“This endorsement is a seamless addition to existing eligible packages for policyholders in low and medium zones. The read-in approach also supports our broker and agent partners’ work-flows,” Shauf adds.

Like its three legacy companies – Farmers’ Mutual Insurance Company, Glengarry Mutual Insurance Company and Lanark Mutual Insurance Company – Commonwell Mutual Insurance Group seeks to maintain “a focus on local presence and service that builds strong long-term relationships for the benefit of the greater community,” the statement adds.