How Much Should Your Contents Coverage Be?

Whether you’re shopping for condo insurance or even rental insurance, at some point we’ll ask you how much you need for your contents coverage. Don’t worry, you’re not the only person who is stumped by this very common home insurance question. What we’re really asking for is how much insurance you would need to replace all of your belongings and stuff in your home.

How do you calculate your contents coverage limit?

Think of everything that you own in your home. This can include:

  • Furniture
  • Computers, TV and all of your electronics
  • Clothes and jewellery
  • Appliances
  • Kitchenware
  • Bedding

When you start writing down all of your belongings and adding everything up, the total can sometimes surprise you. This is what you would consider during your contents coverage discussion.

Don’t cut yourself short – calculate the value of everything

Remember, this exercise is designed to calculate the cost to replace these items. Perhaps you’re still living with hand-me-downs from your parent’s basement. Your couch might have been a gift, but if you find yourself needing to buy a new one, you’ll be looking at a price tag of hundreds of dollars. You also need to keep in mind that although you may be a bargain shopper, if you need to replace your wardrobe due to a fire you may not be able to get the best deals. When you are looking at calculating a value for your contents coverage you want to look at the cost to replace with the same item, at the current value. Consider the FULL COST of all of your belongings.

Why can’t your insurance broker help you calculate your contents estimate?

Although we are always here to help, this is one area that you are on your own. There is no average for contents coverage. Most of our companies have a minimum that they will insure, which is usually around $40,000.  However, over that, it’s hard to estimate without knowing you or your stuff. One person’s 800 SQ ft. apartment may have $40,000 in contents, whereas another will have $400,000.

Keep your receipts

A good way to come up with a contents coverage limit is to keep your receipts, especially if you’re fully furnishing your home. Those receipts can also help you come up with a monthly average spend which can sometimes help you estimate your total limit. Another way to come up with the value is to complete a personal property inventory.

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Keep a property inventory

The Insurance Bureau of Canada has a Property Inventory form here. Not only does this help you come up with a value, but it also means you have a list of your property should you need to make a claim.

There are also some special items that we look at specifically.  Although these items are considered contents, they may have a maximum that you’re insured for. Some of these items are:

  • Jewellery
  • Bicycles
  • Art
  • Business equipment at home
  • Collectibles and Antiques

If you have any of these items, make sure to let us know. Sometimes we can simply increase the maximums for those items and other times we’ll add specific insurance to make sure you’re covered.

It’s important to make sure that your contents coverage is as close to the true cost to replace your belongings as possible. This will mean you’re not paying too much for insurance while remaining fully insured.

Still have questions? Contact us, we’d love to help… where we can.

Harbord the Home Insurance People