What Impacts Your Home Insurance Premium?

From the roof to the basement to the garage, many things that go into calculating your home insurance premium.

Home insurance rates can vary wildly between providers for the same dwelling. But what affects your home insurance rate explicitly? Have a look at the image below to see what may influence the price you pay for your home insurance coverage:

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There are a few home insurance myths that lead people astray when it comes to home insurance. Here are a few things that do not affect your premium:

The Number of Children You Have

Whether you've got one child or 10 little ones living with you, the number of children you have will not affect your home insurance rate.

Your Marital Status or Age

When it comes to home insurance, your marital status or age is typically not a factor, although it may vary by insurer, illustrating why it's important to shop around for the best price.

The Size of Your Mortgage

How much you owe on your mortgage is also not a factor. Whether you owe $50,000 or $500,000, your home insurance rate will be the same. However, if you're mortgage-free, you may qualify for a discount that could be as much as 15% off your premium. On the flip side, if you have multiple mortgages on the same property, that could increase what you pay for coverage.

Your Home’s Market Value

Your home’s market value does not influence your home insurance rate, but the cost to rebuild your house does. A market value assessment takes into consideration things like location, land value, and its comparable value (how much other homes sell for in your neighbourhood). The replacement cost of your home focuses on what it would take to rebuild and duplicate your home, such as the cost of materials, labour, and building permits.

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