Some Canadians didn’t plan their home renos. Are they planning to tell their brokers?
Canadians made major renovations to their homes during the pandemic, and over 14% of those who renovated stated they did so on an impulse during the pandemic — but are policyholders telling their insurers about these material changes?
Not every renovation made during the pandemic was part of a long-term plan, noted Aviva’s How We Live report, yet policies often stipulate a homeowner must tell their broker or insurer about any remodelling plans once those renovations exceed $5,000, in order to maintain coverage provisions.
“Canadians looking to make major changes to their home should know that renovations like finishing a basement, removing structural supports, or building an addition may impact their insurance coverage as they can change the home’s rebuild value,” said Phil Gibson, Aviva’s executive vice president and managing director, personal insurance.
This raises the question of whether the 11% of Canadians who made home renovations in 2021 claimed them with their insurance representatives.
Across the country, 13% of renovations fell within the $5,000-$9,999 threshold, 6% fell within the $10,000–$19,999 threshold, and 7% surpassed $20,000, Aviva’s report said. This equals roughly 26% of renovations that surpassed the $5,000 disclosure bar on many policies.
However, only 6% of Ontarians, 6% of British Columbians and 5% of Albertans in 2013 said they’d looked into their policies before renovations began, according to previous Canadian Underwriter reporting. Respectively, only 14%, 17% and 13% in those provinces followed up with their providers after renovations were completed.
Nearly a decade later, data on whether homeowners have gotten better at telling their brokers about their home renovations remains unconfirmed.
On average, Aviva’s report found Canadian homeowners spent $4,500 on renovations in 2021, although a small percentage spent over $10,000 on improvements.
Plus, two-thirds of renovations made by homeowners across Canada fell below the $2,500 threshold. Ontarians spent the most on renovations in the past year: almost double that of people in other provinces.
Of those who made home renovations in 2021, 56% added to their backyards, 29% added to their home offices, 23% added an entertainment area to their basements, 12% added playrooms, and 3% put on additions.
What’s more, those working from home are spending an average $1,000 more on their renovations, the report fond.
Feature image by iStock.com/Dekdoyjaidee
