Those affected by the Alberta floods may be confused about their options for recovery, but there are a number of steps they can take to maximize their insurance and government-sponsored relief, explains Square One Insurance.
Experts estimate damages from the floods will total as much as $5 billion. The cost of these damages will be borne by:
- Municipal, provincial and federal governments;
- Insurance and reinsurance companies; and,
- Individual businesses and residents.
The proportion of damages each party will incur is unclear. This is particularly unsettling for individual businesses and residents. What’s more, many businesses and residents are struggling to understand what insurance policies cover. That’s because each class of insurance treats flood damage differently.
Protection against flood damage can be added to most commercial insurance policies purchased by businesses, condo corporations and farms. Similarly, protection against flood damage is typically included in the comprehensive coverage option available under most auto insurance policies.
On the other hand, flood damage is specifically excluded from most home insurance policies in Canada. Government assistance programs exist for homeowners and tenants suffering flood damage. It’s important to note that flood damage is distinct from water and sewer backup damage. Most home insurance policies provide some form of protection against water and sewer backup damage. In some cases, it may be necessary to specifically add, and pay for, this protection.
Adding to the confusion for homeowners and tenants is the fact that seemingly similar home insurance coverage, like sewer backup protection, can differ by company. For example, some policies exclude loss or damage caused both directly and indirectly by flood. If the policy excludes damage caused indirectly by flood, then you may not be protected against sewer backup damage even if no flood waters entered your home. That’s because the sewer backup damage was indirectly caused by flood.
What to do
The first step is to file a claim with the home insurance provider. This should be done even if it’s thought the claim may not be covered based on others’ experiences.
The next step is to apply for assistance from the Alberta Disaster Recovery Program. For information on this program, call 1-888-671-1111 or visit this website.
If the claim is not covered, a letter indicating why should be requested. It will help if it’s necessary to escalate the matter. And it may be necessary to submit the letter as part of the application to the Alberta Disaster Recovery Program.
During clean-up, take notes and pictures of the damage to home and property. Keep track of the hours spent cleaning and the costs incurred. These will be submitted to the Alberta Disaster Recovery Program.
If the application to the Alberta Disaster Recovery Program is approved, the Program will cover the costs of returning essential property to its condition prior to the flood. People who can’t return to their homes may be eligible for the pre-loaded debit cards being offered by the government. For more information on these cards, call 1.888.671.1111 or visit this website.