Most of us love to get away occasionally and for many Canadians, a cottage or a vacation property makes the perfect home away from home.
The insurance for your cottage often works differently than your homeowner’s insurance, however, which can sometimes create confusion. Here are some of the basic things you’ll need to know if you’re considering a cottage or vacation property – or if you already have one.
Part of the reason that your homeowner’s insurance is so affordable is that insurers know that you live at your home full-time. You’re able to address issues quickly to reduce damage and your presence deters theft and vandalism. Cottages are usually only occupied part-time, which increases the level of risk due to natural causes, vandalism, or the occasional wildlife visitor. Because cottages are often vacant, the cost of insurance is can be a bit higher than the cost of insuring your home when you compare the insured value of each.
In many cases, insurers will only consider providing coverage for a cottage or vacation property if you insure your primary home with them as well. This isn’t necessarily a bad thing; many times, you can earn additional discounts by combining several types of insurance policies with one insurance company and having one broker handle all or most of your insurance needs helps to ensure that your broker has the information they need to guide your coverage. In some cases, your cottage can be added to your home insurance policy. In other cases, it may be best to choose a standalone policy.
Many owners of cottages or vacation properties choose to use their property for part of the season and rent out the property at other times. If this is the case, you’ll want to discuss your coverage options with your broker. A property that’s rented to a third-party has special coverage considerations and it may be wise to increase your liability coverage as well.
Cottages and vacation properties are also often equipped with toys, meaning boats, snowmobiles, all-terrain vehicles, or maybe even a well-kept classic convertible. Coverage options for vehicles and personal property can work differently for cottages and vacation properties or for occasional-use vehicles, so be sure your broker is aware of the personal property and vehicles you keep at your cottage so they can recommend the appropriate coverage.
One last thought: when you will be away from your cottage for an extended period, be sure your cottage is secured to keep nature outside where it belongs. If raccoons or other small critters take up residence while you’re away, your policy may not provide coverage.