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Retirement PlanningAsk an expert: General insurance for home and business


This article was reviewed by Jay Brecknell, CFP®.

We had the opportunity earlier this month to sit down with Jonathan Luiten (BA, CAIB, CIP), the President of Valiant Insurance Brokers Inc. just down the street from us in Fort Langley, to have a discussion about general insurance.

He gave great insight into what you should be looking for with general insurance for both your home and business. Most importantly, we discussed what you should be speaking with your insurance broker about–and how often you should reach out with updates.

Read our interview below to learn more about Jonathan, and Valiant Insurance’s approach to protecting your home and business.

Interview with Jonathan Luiten

Thanks for joining us, Jonathan. Can you tell us a little about yourself and your approach to general insurance? 

I’ve been in the insurance industry since 1997, and the one thing that I’ve learned along the way is that people like to be treated with respect, and also they like information. People love information. So one of the strengths that I brought to the table when I started Valiant five years ago was a commitment to make sure that everybody understood what it was that they were buying, what it was that made their insurance policy tick, where are the exclusions in the insurance policy, things like that. So just treating people with respect and being honest and bringing integrity to the table by spending time with them, that’s kind of how we’re setting ourselves apart. We’re very good at making sure that people don’t feel like just another number. We’re not here to rush people out the door.

We need to understand the risk and we need to make sure that they understand what it is that they’re buying. So that’s kind of how we’re setting ourselves apart. And that’s what I wanted to do when I started this business, was to make sure that people felt like individuals and not like a number.

Can you let us know what general insurance is and what it covers?

General insurance provides coverage for fire and liability coverage for your everyday risk. So fire insurance, property damage, theft, falling objects, snow, load, windstorm, hail. It’s coverage for the things that you own, your material, items, your contents, your building, your home, your condo, your car, everything. I’m always asked, “what do you do?” And I go, I sell insurance for everything but life and travel.

All your physical, tangible things and then the liability associated with owning those things. So if you own a business and you sell t-shirts, then you can also have liability insurance for people buying your T-shirts and them having an allergic reaction to the material. The McDonald’s famous hot coffee lawsuit is the classic example.

So general insurance covers pretty much everything that has to do with possessions. And then outside of general insurance is health and life insurance.

And that’s the stuff that you guys take care of and are involved in. In our industry, you can be licensed for two things: general insurance or life and benefits.

What are the main things that people are generally coming to you for when they’re looking for home insurance or business insurance?

People who are tired of not understanding what it is that they’re paying all this money for. Because rates have been on the increase for quite a number of years.

We’ve been in a hard market for a while, and a hard market occurs when insurance companies’ return on equity investments aren’t great and losses are high, so they’re not collecting enough premiums because their business is just like any other business. So they need money to run the business, but then they also need to meet catastrophe fund requirements that the Financial Institutes Commission, which is government-related, oversees them to maintain. So we have been in a hard market, I would say, since 2018 or 2017.

And this hard market is more targeted and less radical in terms of the increases that people are seeing. We’ve been seeing a steady 8% to 10% rate increase in a lot of areas like home insurance, and that has a lot to do with water damage losses being on the increase.

And then, of course, we have had the forest fire issues and flooding issues. There’s just been a lot going on. And so we find that people are saying, okay, well, what is it that I’m paying all this money for? And how can I get more value if this is what the premium is? So what we’ve been seeing a lot of is people who haven’t shopped in a long time, so when they walk in, we do a little market evaluation.

So we’ll take their risk and we’ll send it out to the insurance companies we have available for that risk and see what comes back. And oftentimes we’re giving them rate decreases of anywhere between 5% to 20% and bettering their coverages.

I’d say that’s about half the time. The other half the time, people come in and their risk is completely undervalued. And so we have to go through it and see you’re paying $2,000 for a $1 million coverage on a home, but your home is actually at a replacement cost evaluated at $2 million. And so you find that people go, “Oh, wow, so I’m not paying enough insurance.” That’s the other flip side of letting it just continue. Renewing over and over without review will result in a policy that will not respond properly if you were to have a loss.

What do you typically see when people renew without review?

Typically it opens up Pandora’s box of, “Hey, yeah, insurance is a scam because I’ve paid all this money over the years and it doesn’t work.” Well, the reason it doesn’t work is because the broker hasn’t set it up properly. Or the broker hasn’t educated you on things that are not covered and cannot be covered by insurance. Those are just risks that are associated with owning a building or owning a home or owning a business.

So we strive to bring integrity to the table by educating our clients on what it is that they’re insuring and what it is that they can’t insure so that they can make plans in their budgets to understand, what do I need to self-insure here?

What are people overlooking more often than not?

Many people are underinsured for their homes. If it’s a home policy, what happens is when you insure your home, let’s say you bought your home in the year 2000 and your broker performs a replacement cost survey on the home to find out how much it would cost to rebuild it from scratch. And that also pays for landscaping services, underground services, the foundation, and debris removal. All of those things are covered by insurance, and people forget about that.

So oftentimes, people just renew, renew, renew. And insurance companies apply inflation to the home value each renewal, which could be, depending on the market and what we’re experiencing, 3%, or 4%. Now it’s 7%. However, in the Canadian construction price index, we could see higher rates of inflation in certain areas and certain types of products and materials, and labour.

Labour is a big issue. So I’ve been finding when people come in and we do a replacement cost survey on their home, they’re underinsured. Now, there are protections in a policy to make sure that a homeowner does get full coverage, but if they’re grossly underinsured, they could have a problem with getting full coverage on a claim. So one thing that we’re just doing is educating our clients and making sure that their risk is properly insured.

The other thing that people always forget about, too, is jewelry. Jewelry, antiques, fine arts, firearms, and e-bikes: these are all sublimated within the insurance policy. So, yeah, you might have a lot of content limit because the contents insurance that you get for your home is usually about 80% of your home value.

It’s just a thing they do to make sure that nobody has to sit there and write down what it is they all own. Right?

It’s a protection for the homeowner, for the client, and for the consumer. But insurance companies do sub-limit these kinds of special things within the policy. So, for example, people will forget that jewelry is only covered up to $6,000 or $10,000, whatever it might be, within the policy limit, but they might have family heirlooms and expensive jewelry. So I always say to my clients, don’t forget to get your items appraised. And if they come out to a higher value than what the limit is for within the policy, you can schedule it on your policy for an additional premium.

However, it expands the coverage to include mysterious disappearance, and it removes the deductible altogether in most cases. So, for example: you take your engagement ring off to wash your hands in a restaurant bathroom and then you go back to eat dinner. You realize you forgot your ring in the bathroom. You go back and it’s gone. That’s typically not covered unless you’ve scheduled it on your insurance policy.

Stuff like that is usually what we see people missing. Reviewing what those sub-limits are within the policy wording, and brokers need to educate their clients on what those sub-limits are and reach out and see. Do you have an e-bike? Do you have any antiques? Do you have fine art? Fine art gets missed a lot, I find. Sculptures and paintings like Robert Bateman’s, things like that.

Thinking of retirement, and retirement in Canada in particular, a very popular demographic are Snow Birds. What are some considerations that this group of homeowners should consider when they are away for three to six months or more at a time?

Well, number one, bring it up with your broker, first of all, because every single home insurance policy in the country has what’s called a vacancy clause. Your house is not considered technically vacant because you are returning to it. A house is only considered vacant if it is empty for 30 consecutive days and you have no intent on returning to the home.

So the house is fine. You don’t have to worry about that. But there is a clause in most policies—I would say, around 99% of policies (just because 1%, there could be a different underwriter doing something different out there) but it’s very rare—where there is a requirement within the wording on a home policy, even a condo policy and a tenants policy that if you’re going to be gone for four consecutive days, maybe even five, and in some cases it’s three. I always err on the side of caution and say, if you’re going to be gone for more than three or four consecutive days, you need to have someone come through the property.

For example, I’ve got several snowbird clients, and we always say, do you have a family member who can come through the home once every three to four days and make sure the water is still shut off, that there are no potential water damage hazards, that no toilets are overflowing, there’s no sewer backup issues? Because an insurance company could use that as an opportunity to not cover the claim. Those are all really important things that people need to keep in mind. So if you’re gone for a long period of time, let your broker know so they can put the insurance company on notice. And then, secondly, make sure that you have someone coming through the home on a regular basis.

Some wordings may have changed, but I’ve been doing this for 27 years and that seems to be the resounding number of days—I’ve just erred on the side of caution. It doesn’t really cost you anything to ask your son or your daughter or cousin or your uncle to just pop in once a week. Every Wednesday, come into my house. Or every Saturday, come into my house. As long as that is being done, the insurance company has no grounds to decline the claim if the toilet were to burst on the second month of you being gone.

On the topic of homeowners with unique situations, a lot of people have in-home suites that they’re either renting out to tenants or maybe they’ve got family members living in them.

What kind of additional policies do they need to consider to make sure that the suite and their tenants are covered?

So insurance has always operated a little bit differently. Insurance companies don’t care if it’s legal or not legal. It’s just not a question we have to ask when we’re doing an application form. They just don’t care. They want to know how many suites are in the home and how many people live in those suites in the home. And there’s a surcharge that’s applied because having extra people in your home does increase your risk for fire, water damage, smoke—all that kind of stuff. So there is a surcharge. If you didn’t declare that to the insurance company and your tenant in the basement suite was to flood the home or cause a fire or cause smoke damage, for example, the insurance company could use that to decline the claim. So that must be declared.

If you set up your home and you don’t have a renter just yet, it’s okay. But once you get one, you must advise your insurance company.

The other flip side to that is that the insurance company will require your tenant to carry their own insurance for their contents and liability. That is a big plus for the tenant to have because the homeowner’s insurance company will go after the third party who’s responsible for the damage to subrogate the loss. They don’t care who that person is. It’s their right within the policy wordings to subrogate a loss that they feel is subrogatable under law no matter who that third party is. And the homeowner has no say, wouldn’t matter if it’s your grandma, wouldn’t matter if it’s your cousin’s grandma, they don’t care. They will subrogate the loss.

So your tenant must always have their own insurance. And it is becoming increasingly popular for an insurance company to say yeah, no problem, but we need proof that the tenant has insurance.

When talking about general insurance for business what are the additional things that business owners should be considering for their business insurance beyond what homeowners should consider?

Well, businesses change a lot, services change a lot. People add certain things throughout the year that they may not feel have an additional risk to it. But their insurance company, if it’s not declared on the application form or to the broker when they first set up a policy, then there would be no coverage for that or the insurance company will have grounds again to decline the claim. So people need to stay in touch with their brokers on a regular basis on new services, new products, things that they’re going to be adding throughout the year. Insurance companies rate liability based on revenue.

So the other thing is that there is an audit clause in a business liability policy where an insurance company can audit your CRA, your notice of assessment, and your financial statements to make sure that the revenue that you’re declaring to your broker, which they use to rate your liability premium on, is adequate and that it is as accurate as possible.

What happens sometimes is people will under-declare their revenue on purpose so they don’t have to pay as much premium. The problem with that is that would be considered fraud. So you’re saying my business gross is $30,000 a year, but you really do $200 grand. Well, that is a really gross difference in what you’re actually making. So different that an insurance company would be like, oh yeah, you’re under-declaring your revenue.

And if it’s a new business and it’s just been growing real fast, that’s taken into consideration of course, but your responsibility is to touch base with your broker and adjust your liability accordingly. I always say people should be doing that on the safe side anyway, because you just don’t want that conversation with the insurance company. When someone is suing you for a million dollars, you want to be able to go to sleep at night knowing that everything is great. So I find with new businesses that come to Valiant, we usually do a six-month follow-up and just say, “Hey, how’s everything going? Did this revenue venture explode or did you end up going in a different direction or did you add any services? Did you add any products?”

The other thing is, with businesses, if you have a brick-and-mortar store, you may have an alarm warranty. When it comes to theft coverage, having proper theft coverage means that you must make sure that your alarm is armed every single night. If you don’t arm it and there isn’t a warranty on your policy, there will be no coverage for theft if you have not armed your alarm.

What are the general considerations or recommendations that you have for business insurance?

The biggest thing that we’re seeing right now is if you are hiring sub-trades to do work for you within your scope of operations, they have to be insured. There is a warranty on insurance policies that states if you hire a subcontractor to do work for you within the scope of your operations, that subcontractor must be insured and have a limit of 2 million liability at minimum. If they don’t and they trigger a claim against you and the sub-trade, your insurance company will decline to cover your percentage of negligence in the lawsuit. That has now been upheld in court. This is the most recent change in our industry where we’ve seen a warranty be upheld in court in favour of the insurance company.

Usually, these things go in favour of the client, but in this situation, it’s been upheld. And so now that is the precedent in common law in Canada. I always say to our contracting clients, “Make sure all of your trades are insured and that you’re added as an additional insured as well.”

What would you say is a good rule of thumb for home and business, regarding how often you should speak with and update your broker?

Well, I think any time you’re doing a renovation is definitely a trigger. Call your broker, whether it’s the home or it’s the business, when you move, we definitely need to know when you move and basically anything that changes from the first time that you’ve chatted with your broker.

When it comes to your home insurance, don’t just renew. Don’t auto-renew it. Usually, we make a phone call to our clients anywhere between two to six weeks before renewal. Depending on how busy we are, we always will reach out to clients beforehand and say, has anything changed? But a lot of companies are big and they’re very busy, and people are just pushing renewals out. That’s why people get an auto-renewal and they totally forget about their home insurance. They don’t review it. They just get an email.

So if it’s coming up for renewal, I would say err on the side of caution. Bring it over to Valiant so we can have a look at it. Don’t just auto-renew because you could be missing something.

Going back to our discussion about rental suites, is it a best rule of practice to declare everything and be upfront and honest with your insurance broker?

Yes. We don’t chat with the city or report—things like that don’t come into our scope of work. I’ve never had a bylaw officer come and ask me a question. Insurance companies don’t ask when it comes to legal or illegal suites. I’ve never seen an insurance company not rebuild a home with the suite in it after a loss, for example. So please be upfront because we don’t get into that at all.

I know Airbnb rentals are going to be limited or gone one of these days anyway, but I will say that if people do have Airbnb in their home, that is also something that they need to declare to the insurance company as well. That would be considered a material change in risk. And if they didn’t know about it, they would say, sorry, no coverage altogether.

That also needs to be set up properly because not every home insurance company likes Airbnb rentals, so they remove risk altogether and then the broker has to find a new insurance company and that might be with a non-standard insurer and actually be quite expensive to replace with a regular home policy.

Do you have any closing comments or recommendations for general insurance?

I will say just in terms of home insurance, a good rule of thumb for people to understand what is not covered traditionally right across the board are things like damage from insects, vermin, rodents, birds and animals, and then also damage from wear and tear, rust and corrosion, and latent defects. And latent defects are more like a manufacturer’s warranty issue anyway. This comes more into play when you install a new furnace or new appliances, or you have a pool with pool equipment.

And another thing: people should also be declaring to their insurance broker when they get a dog because if it’s not noted on the insurance file that they have a dog and that dog bites a third party, the insurance company could say, well, sorry, no coverage for that dog bite claim, because we didn’t know that you had a dog.

There’s no charge for it. It doesn’t cost people anything to have a dog, but it’s just one of those risks. If it’s not noted in the file, the insurance company will go, sorry, no coverage.


General insurance, whether for home or business, is not a simple set-it-and-forget-it situation like many of us are led to believe. Even minor changes in our lives, homes, and business can leave us open to liability or loss. Luckily we have experts like Jonathan at Valiant Insurance who can help us understand our policy and keep it updated.

Just like how we help you plan for your retirement, he can help you ensure your most valuable assets are protected. The key takeaway here, and always, is to speak with your team of experts when there are changes in your life. A short phone call or email can help keep you protected and save a bigger headache down the road. And in many cases, it can even help you save money in the long run.If anything has changed in your life don’t hesitate to book a call with us here at Cedar Rock Financial, or reach out to Jonathan at Valiant Insurance to make sure you are set for success!

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