Insurance Perspective: Preparing for a Natural Disaster in Canada

As the frequency and calibre of natural disasters continue to increase in Canada, there are ways – from an insurance perspective – that you can be as prepared as possible for when a natural disaster strikes.

According to a Global News report, natural disasters in Canada triggered $4.9 billion in insurance claims in 2016, smashing the previous record of $3.2 billion in 2013. The Fort McMurray wildfire, in Alberta, alone accounted for $3.7 billion in insurance claims in 2016.

Here are five ways to prepare for a natural disaster, from an insurance perspective.

Pay Your Insurance Bills

This may seem like a ‘’Yeah, no kidding’’ statement but there are a lot of people that non-pay on their insurance policies – for a variety of reasons – which often leads to insurance coverage being canceled.

For those who pay their insurance bills monthly, you might be surprised (or not) to learn that the insurance industry isn’t near as flexible as other industries when it comes to missing payments. If you miss one monthly payment, you will likely receive a registered letter to pay what is owed within two weeks. Some companies will notify you and tack the payment onto your next monthly payment. In both of these scenarios, if the next payment isn’t made, your insurance will be canceled.

Depending on your past insurance history, both with your current provider and other providers you have been with in the last five or so years, your insurance could be terminated immediately for a missed payment.

If you miss a payment, it’s in your best interest to get in touch with your insurance provider and rectify the situation as quickly as you can. Your best-case scenario is about a month of leniency. Your worst-case scenario is immediate termination of insurance.

Always paying your insurance bills on time means you don’t need to worry if you have insurance or not when disaster strikes.

Understand Your Insurance Policy Coverages

Now that you’re always paying your insurance bills on time, you better know exactly what you’re paying for.

Understanding your policy – be it for your vehicle(s), home, business, etc. – can help ensure there are no unexpected surprises, in the event you need to activate your insurance policy.

If a natural disaster strikes, don’t be caught off-guard, assuming you have coverage for certain things. If you’re worried about what coverage you have for overland water (flood), check your home policy. If you want to know if your vehicle is protected against fire, check your auto policy. If you want to know the coverage your small business equipment has, check your commercial policy. In addition, if you happen to own a cottage out in the wilderness, you might wanna consider why you would need cottage insurance in Ontario. 

If you need to update or change your policy, or just want clarification on your coverage, be sure to reach out to your insurance broker/provider. Natural disasters are hard enough to deal with. Do not add the pain of misunderstanding to the heartache.

Get an online car insurance quote.

Pay Attention to Weather Trends

Global warming causes adverse effects on the weather. It is no coincidence that as the average temperature in Canada continues to climb, more natural disasters are occurring.

In 2013, residents in Calgary, AB probably never would’ve guessed they’d be in an area susceptible to flooding. Global warming not only affects temperature, but it also impacts how much moisture the atmosphere holds. Flash floods and large snowfalls are direct consequences to the increase in moisture being retained in the atmosphere.

Noticing the weather trends in your city/province, then making sure your insurance coverages include fire and/or flood, can significantly ease the financial burden should a natural disaster occur in your area.

Use Your Additional Living Expenses Wisely

Every home insurance policy will have Additional Living Expenses included in it. If you’re displaced from your home because of disaster, your additional living expenses coverage will kick in to cover your food, shelter and transportation costs.

It is important to note that just because you’ve been displaced from your home, doesn’t mean your additional living expenses will cover lavish spending. Depending on your home insurance policy and home value, you’ll likely be allotted a certain amount per day to cover your expenses.

Get an online home insurance quote.

Have a Natural Disaster Emergency Plan

This isn’t insurance related, but it’s a great idea to have a game plan of what you’d do if you and your family are displaced by a natural disaster.

An emergency evacuation plan can include a meeting spot, a 72-hour emergency kit (food, clothing, blankets, first-aid supplies, back-up cell phone, etc.) and whatever else you would deem essential in the unfortunate case you’re displaced.

It is a good idea to have more than one meeting place in mind, to account for the type and severity of natural disaster that may occur.

Again, hopefully you'll never have to worry about being displaced by a natural disaster. If you’re in Canada and forced to leave your home because of a natural disaster, it’s best to have an emergency plan and understand the coverages in your insurance policy.

Get an online commercial insurance quote.