Fire in the insurance industry is known as a ‘risk’ or ‘peril’ meaning the cause of a loss or damage. The wildfires in Fort McMurray and the surrounding area in 2016 illustrated fire’s devastating effect – both on the community, province, and the insurance industry.
As a full-service, independently-operated insurance brokerage that provides insurance policies from maximum to minimum coverage to meet your individual or business needs, at Thomson Schindle Green Insurance Company we want you, our clients and potential clients, to have the best policy possible and the understandings that go with it. This is but a few of the reasons why understanding your insurance policy, and especially fire coverage, is critical for all Albertans.
If you have home insurance and your home is damaged, you’re covered. According to the Insurance Bureau of Canada (IBC), “virtually every home insurance policy covers damage caused by fire, even if the fire began on a neighboring property”. It’s important that this be said because there’s a lot of misinformation about natural disasters; some believe there is an “act of God” exclusion on their home insurance policy, but this isn’t the case. In fact, “there is no such thing as an “act of God” exclusion in any property insurance policy in Canada.”
However, there are several factors that affect your premium including the location of your home, and the type of coverage you purchase. When it comes to location, companies use ISO Public Protection Classes (also called National Board Class) – a number from 1 to 10 that refers to the public protection facilities in a geographic area – with lower numbers reflect better facilities and protection to help determine premiums.
According to the National Association of Mutual Insurance Companies:
- A Protection Class 10 has no fire protection (or very low protection).
- A Protection Class 9 has little fire protection and no hydrants within 1,000 feet of the property. Both 9 and 10 classes are considered unprotected classes.
- Some protection class directories show divided classes (for example 5/9 or 6/9). This means that the lower class is allowed if a hydrant is within 1,000 feet of the residence, but the higher class is to be used if the nearest hydrant is over 1,000 feet from the residence.
Many companies use a more simplified Fire Protection Rating where the location of the building(s) determines its fire protection classification as defined below:
- Protected – Building is located within 1,000 feet of a fire hydrant and within five road miles of a responding fire department.
- Partially Protected – Building is located over 1,000 feet from a fire hydrant but within five road miles of a responding fire department.
- Unprotected – All others.
Next is the type or level of insurance coverage you opt for – basic, named perils, or comprehensive or all risk insurance. Some policies specify the upper limit of how much money you’ll receive in a claims payout, while other policies include “guaranteed replacement cost” coverage.
If you have questions about fire protection for your home or business, contact Thomson Schindle Green Insurance Company at 1-800-830-9423 to speak with one of our highly qualified representatives to receive a free quote or visit one of our offices in Bassano, Brooks, Calgary, Edmonton, and Medicine Hat today.