In Canada, there are four home insurance categories that homeowners need to consider: comprehensive, basic, broad, no frills. Below is an explainer on each.
Comprehensive - This type of policy covers the building and all the contents inside against any and all insurable perils. This is the most secure option and also the most expensive one — comprehensive insurance is ideal for those who don't want to take any chances.
Basic - A low-cost option, in which your home is only protected against specifically named perils.
Broad - The in-between option: the structure of your home is covered against all perils, but the contents are only covered against perils of your choosing. Broad coverage is widely thought to be a compromise between comprehensive and basic coverage.
No-Frills - A no-frills policy is recommended when the home in question doesn’t meet the insurance company's underwriting standards, likely because the structural integrity of the building isn’t up to par.
Personal liability is covered by home insurance. It provides coverage for the owner in the event of accidental damage caused to others on your property (e.g.; someone gets injured on your property).
Water damage is not covered by standard insurance policies. Coverage is available, but you have to purchase it as an extra. Residents of the Northwest Territories will likely want to make sure that all possible flood damage protection is included because of the frequency of winter storms, glacial melts, river overflows and ice dam breaks.
One thing that homeowners in the Northwest Territories can keep an eye out for is overland flood insurance, which offers protection from storm surges or the overflow of water bodies nearby. This sort of home damage can result in costly repairs. This is also known as comprehensive water coverage.
Owners in the “no-frills” category probably want to think carefully before buying this insurance policy type: because the climate is so harsh, structural shortcomings will likely end up costing you down the road.