Canadian Underwriter
News

The ‘overlooked’ risk for Canadian homeowners and renters


May 9, 2022   by Jason Contant

Bathroom renvoations

Print this page Share

Unintentional damage during renovations — especially water damage — continues to be an overlooked risk for Canadian homeowners and renters, according to a recent study from Chubb.

The Chubb 2021 Homeowners Risk Report: Trends in Home Renovations and Water Damage found 53% of Canadian and U.S. homeowners and renters “experienced a loss or unintended damage to their home during recent renovations.” The fifth annual study, conducted in November and December 2021 and released late last month, is based on 300 completed interviews in Canada and 1,200 in the U.S. (study results in Canada were 75% homeowners and 50% in Ontario.)

Water damage during renovations continues to be an overlooked risk, and homeowners and renters should “always be prepared for the unexpected, as water can accumulate and cause severe damage,” says Ana Robic, division president of Chubb North America Personal Risk Services.

More broadly, “water damage, along with natural catastrophes and a competitive residential marketplace with constrained availability of homes and supply chain issues, are just a few concerns facing homeowners and renters today,” Robic says. “Individuals should work with a knowledgeable agent or broker and carrier to help them prepare and protect their residences.”

Internal claims data from Chubb shows non-weather-related water losses continue to be the Number 1 source of property damage, with 48% of all interior property damage caused by water (more than fire and burglary). An average interior water claim payout for Chubb was more than $50,000.

To help protect their homes, clients need to be aware of insurance coverage for water damage. However, a recent survey of Canadian homeowners conducted by rate comparison site LowestRates.ca found 30% of 544 respondents weren’t aware coverages like overland flood are add-ons to a standard home insurance policy. Only 9% added this type of coverage to their policies last year.

This finding is troubling considering more people have been home during the past couple years due to the pandemic, and so more people are renovating their homes. Depending on the renovation, clients may be required to increase their insurance coverage. In fact, about 65% of Canadian and U.S. homeowners and renters who purchased in the past two years found areas of concern in the home after purchase.

Chubb also found more than one-third (35%) of survey respondents (Canadian and U.S. homeowners and renters) embarked on home renovation projects. Those planning future renovations seemed to be more inclined to do it themselves, according to the survey. Those considering home renovation projects in the next 1-2 years are interested in a bathroom overhaul (40%), a kitchen renovation (26%), or living or family room refresh (23%).

To minimize costly damage, Robic recommends that “homeowners should consider pre-emptively installing a flow-based water leak detection device, and for renters and condo owners, water leak sensors to protect their residences before it’s too late.”

 

Feature image by iStock.com/yellowsarah


Print this page Share

Related


Keywords