Inflation and the Rising Trend of Underinsured Claims: Tips for REALTORS®
According to Aviva Insurance, there has been a growing trend of underinsured claims across personal and commercial property lines over the past two years. This trend is fuelled by customers not being adequately insured to value. As a result, Aviva says that claims are coming in much higher than what customers are insured for.
With inflation hitting new record levels and driving up claims costs, REALTORS® must help their clients understand the importance of ensuring their commercial and personal properties are insured to value.
Impact of inflation
Increases in material and labour costs and global supply chain issues have significantly driven up reconstruction costs on homes and commercial buildings. With the Consumer Price Index recently hitting a 30-year high of 6.7 per cent, the value of contents is something commercial property customers should not overlook.
For homeowners, the COVID-19 pandemic resulted in a wave of home renovations, additions and appliance upgrades as people suddenly found themselves spending more time at home. These property updates and the increased materials costs can easily lead to underinsured claims. Thus, it leads clients to new assets that don’t correctly reflect their existing policy.
Encourage your clients to confirm they are fully insured
Realtors should suggest clients review their personal policies to ensure their insurance adequately covers their property to value. Clients can speak to their insurance providers for advice and additional access resources.
On the other hand, generally, commercial properties can get a detailed appraisal of a building from an appraiser accredited by the Appraisal Institute of Canada. As well, homeowners can get a valuation from an inspection report.
BCREA’s Home and Lifestyle Insurance Program
Did you know BCREA is partnered with Aviva Insurance to provide Realtors with options regarding their own insurance policies?
Our Home and Lifestyle Insurance Program offers market-leading policies for homeowners, condominium owners and tenants at a preferred rate. Discover more professional benefits today.
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Aviva Insurance has provided services to BC Realtors for more than 25 years. Thousands of professionals throughout BC and Canada rely on the Aviva team for their specialized advice and educational resources and to help ensure they are properly protected.
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