Special Limits: Limits on Your Home Insurance Contents

Elliott Insurance Services    September 11, 2017

A woman reading her special limits on her policy.

“Special limits” is a fancy term to indicate that there are limits or caps put on certain contents in your home insurance policy in the event of an insurance claim. Not knowing which limits could affect you could be devastating to your way of life if you ever experience a claim on your home, tenants, or condo insurance policy. Unfortunately, every insurance company has different limits and different categories, so it is extremely important to know your policy, or have an insurance professional who knows the special limits from your insurance company.

A very common special limit example is money (cash, cards, bullion). If you keep large sums of money at home and were suffer a loss such as a fire or theft, you may be in for a surprise. The majority of insurance companies in Ontario will limit the payout for the loss of money to surprisingly low amounts anywhere between $500 and $1500. With the special limits in force, the insurance company will not pay out higher than the limited amount stated in the wordings from your insurance company. If you had $10,000 in your mattress and a fire burned the money, you would only get the amount that is listed in the special limits for your policy (anywhere between $500 and $1500 most likely). It would not matter if you could prove you had more money in that mattress, it is an agreed upon amount that they are willing to pay.

It is impossible with the majority of the current Canadian insurance companies to know what your special limits are by simply looking at your insurance policy. Unfortunately there is only so much space on an insurance policy, so the companies will put the special limits in their wordings (the very thick legal contract portion that often is only sent when the policy is written or the wordings change). The danger of not knowing these limits could make an insurance claim very messy and disappointing for the insured (you). We will try to outline the most common special limits enforced by the majority of the insurance companies in Canada in order to provide you with a rough idea of what to expect on your insurance policy. It is highly recommended that you have an insurance professional such as an insurance broker or agent let you know what your special limits are.

Common Special Limits

Every company will have its own set of special limits that they enforce on their home insurance policies (homeowners, tenants, condo) and hopefully when you purchased your home insurance the agent/broker whom you purchased the policy from informed you of the limits on your policy. Some common special limits are as follows:

  • Animals, Birds, Fish
    • Usually limited anywhere between $1,000 and $5,000
  • Bicycles
    • Usually limited anywhere between $1,000 and $2,000
  • Collectible Cards and Comic Books
    • Usually limited anywhere between $,2000 and $5,000
  • Jewellery, Furs, Watches
    • Usually limited anywhere between $6,000 and $10,000
  • Money, Cash, Cards, Bullion
    • Usually limited anywhere between $500 and $1,500
  • Numismatic Property (Coins)
    • Usually limited anywhere between $500 and $5,000
  • Securities
    • Usually limited anywhere between $3,000 and $10,000
  • Spare Automobile Parts
    • Usually limited anywhere between $1,000 and $3,000
  • Watercraft
    • Usually limited anywhere between $2,000 and $5,000
  • Motorized Lawn & Garden Equipment
    • Usually limited anywhere between $10,000 and $20,000
  • Business Property (on insureds property)
    • Usually limited anywhere between $2,000 and $5,000
  • Renewable Energy Equipment
    • Usually limited anywhere between $5,000 and $10,000

As you can see above, the limits could be an issue for any home. Considering that mid-range bicycles could cost anywhere between $300 and $1,000, it could put some of those special limits into focus for a family that has more than one bicycle.

The entire point of insurance is to put the insured (you) back to where you were prior to the loss. That can be a different vehicle after a collision or it could be rebuilding a home for you after a total loss to your previous home. It is important to know what special limits may be enforced in the event of a loss to your home because you may not be getting back what you think you will.

Talk to your insurance professional about your policy today so to avoid insurance related surprises tomorrow.

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