Types of Insurance When You Own Real Estate

What Is Mortgage Default Insurance?

Mortgage Insurance protects a lender in case there is a default in mortgage by the borrower. In Canada this sort of insurance is typically needed for mortgage loans with down payments less than 20% of the property value.

In Canada there are three companies offering mortgage default insurance:

• CMHC
• Sagen
• Canada Guarantee

Mortgage Life Insurance can pay off the outstanding balance on the insured mortgage in the event of your death.

Mortgage Critical Illness Insurance can pay off your outstanding mortgage balance in the event you are diagnosed with severe illnesses such as heart attack, stroke or life threatening cancer, providing you and your loved ones with a “living” benefit..

Mortgage Disability Insurance can pay your mortgage payments should you become disabled and are prevented from performing the normal duties of your job due to accident or illness.

Life Insurance (not related to your mortgage) gives your family or beneficiaries a tax-free cash payment after you die. This way, they can help take care of their financial needs even after you’re gone.

Will Without a will friends, charities, or other beneficiaries cannot inherit your assets. Only family can inherit. Having a will insures your loved ones are provided for.

Title Insurance Incidents of real estate fraud are increasing in Canada and homeowners and lenders are proving to be irresistible targets for fraud artists.  Homeowners and lenders can protect themselves by obtaining a title insurance policy. The coverage provided in residential title insurance policies helps protect both innocent homeowners and lenders who might otherwise face huge financial losses resulting from title fraud.

Home insurance If you own your own home, then you’ll want to protect not only your physical building, but all the things in your house too. A standard house insurance policy will ensure that if something like fire, vandalism or theft occurs, then you will be properly looked after and your valuables will be replaced.

You also need to think about protecting any other structures that exist on your property, like a detached garage.  As well, in the event that your house is damaged, and you need to move out for a while, you may want to consider investing in insurance that will help pay for out-of-pocket expenses like hotel rooms and food.

As a homeowner, it is possible that you may be held liable for accidents that people have while on your property. What’s more, you may accidentally damage other people’s belongings either in your own house, or somewhere else. A well-structured house insurance plan will make sure that you’re covered for any of these unforeseeable events.

Condominium Insurance When you purchase a condominium, you own your “unit” and own a share in the common areas of the condominium – the roof, basement, elevator, heating room, lobby, swimming pool, parking garage, or garden. As a condo owner, you may be held responsible for harm you might cause to any part of your building, or to other whol live or visit the condominium complex. A condominium insurance policy can remove some of the financial worries of condominium ownership.

Tenant Or Renters Insurance If you’re moving into your first apartment, you might think you don’t have anything of real value. A CD player, computer and some clothes may not look as if it’s worth much, but when you have a to replace it with something new, it could break your budget. Say you’ve bought a computer on credit and it’s destroyed by fire or stolen. You’re still responsible for paying the balance to your creditor, even though you no longer have the item.

As a tenant or renter in someone else’s building, it’s a wise decision to take out a tenant insurance policy. It protects both your contents and your liability exposure. You see, as a tenant, you’re responsible for harm you might cause to any part of the building you live in, or to others who live or visit there. If you forgot to turn off the water in the bathtub while you’re talking to your friend, you could flood out your neighbours. You would be responsible to repair any resulting damage.

Rental Property Insurance Owning one or many rental properties is a vital source of income, which means it’s an investment requiring a comprehensive insurance solution.  Rental Property Insurance helps to provide customized coverage addressing replacement of contents, loss of rental income, bylaw compliance, and more.