Over the past two years, we have seen an increasing trend of underinsured claims across our Personal and Commercial Property lines. Fueling this trend has been issues with customers not being adequately insured to value, resulting in higher claims coming in than what customers are insured for. With inflation hitting new record levels and driving up the costs of claims, even more, it’s more important than ever to ensure our customer's Commercial and Personal Properties are insured to value.

Impact of inflation

Increases in material and labour costs, as well as global supply chain issues, have drastically driven up reconstruction costs on homes and commercial buildings. It's not just the home construction value that is on the rise, the contents too are increasing in value.  With the Consumer Price Index hitting a 30 year high of 5.1% in January 2022, the value of contents is something that should not be overlooked by our Commercial Property customers.

From a Personal Lines perspective, people are spending much more time at home due to the ongoing COVID-19 pandemic, which has resulted in more home renovations, additions, as well as new appliance upgrades. The ongoing property updates, along with the rising costs of materials can easily lead to underinsured claims if adequate coverage is not reflected in the policy.

Ensure you are fully insured

Commercial Lines - Property policies

• Re-evaluate the building and content value annually to ensure the information is accurate and that you are fully covered.
• Maintain a record of accurate building construction information such as area, number of stories, construction type, and materials used. Don't forget underground areas like basements and parking garages.
• Get a detailed appraisal of the building from an appraiser accredited with the Appraisal Institute of Canada.

Personal Lines - Property policies

• Consider all recent builds and renovations impacting the property.
• Consider content value -- have you upgraded to higher-end appliances?

What can you do

If changes have been made to your property, it is imperative that you advise your broker, as this can impact their insurance coverage. Throughout this ever­ changing pandemic, we remain committed to supporting you every step of the way. When in doubt, please connect with us with any questions or concerns.

With thanks to Aviva for their editorial contribution.