What's common practice isn't always common knowledge in the home insurance business, as an elderly woman battling cancer learned recently. 

As revealed by a CBC Go Public investigation, Ivy Scotland, 84, was stunned when she was saddled with an $11,000 repair bill after she left her Pembroke, Ont., home for treatment near her hospital. In the intervening three weeks, the pipes in her home froze and burst, causing water damage.

But Grey Power denied Scotland's insurance claim, citing a clause in the policy that Canadians who leave their homes unattended for more than four days in the winter are not eligible for coverage for water damage unless they appoint a responsible person to check the heat inside every day.

Insurance experts agree the case is unfortunate, but the rules are as they are.

"That's an exclusion on every personalized property insurance policy I know," said Ken Orr, owner of Orr & Associates Insurance Brokers, and a former president of the Insurance Brokers Association of Canada. 

"We try hard as brokers to tell people in our newsletters and remind them there are limitations in all policies."

Standard exclusions aren't always immediately clear, however. Still, there are some general limitations and misconceptions home owners should make themselves aware of:

30-day vacancy rule

If you're a property owner whose rented house remains vacant for more than a month, your insurance company can deny coverage for any losses such as fire or water damage. The 30-day rule applies whether or not the customer is paying monthly insurance bills. 

Ivy Scotland 2

Scotland was undergoing cancer treatment at Ottawa General Hospital when her furnace went out in her home, causing the pipes to freeze and burst last winter. (CBC)

"It can only be vacant for 30 days without notifying your insurance company, then technically the coverage is void," Orr said.

"If somebody owns a rented dwelling, and the tenants move out and it might be a month or two before you move back into it, that's a concern."

Owners can still obtain what's called a vacancy permit from their insurer so the coverage never ceases after the occupants have moved out. However, this add-on, which must be purchased within the 30 days, is typically limited to exclude malicious acts and vandalism.

A primary difference between a "vacant" and an "unoccupied" property is whether furniture is inside, indicating the owner intends to return. Snowbirds, for instance, could still leave for months at a time, and their homes would be considered unoccupied.

Jewelry covered only up to a limit

Home insurance only covers for the theft or loss of precious jewelry up to a "sub-limit" that could end up vastly undervaluing such items.

Some firms might offer coverage for up to $5,000 or $6,000, Orr said.

Brian Maltman, ‎executive director for the General Insurance OmbudService, which handles insurance disputes for Canadians, recommends consumers get their fine jewelry appraised and purchase an extension to their policies. 

To do this, they would probably have to provide supporting documentation such as photographs to prove the worth of their high-valued possessions.

Limitations for rare items

Christmas fire leads to year-long insurance coverage battle

The Browns' St. John's home after it was gutted by fire last Christmas. (Stuart and Annie Hall)

Stuart and Annie Brown

Annie and Stuart Brown lost their St. John's home to fire in December 2013. (CBC)

Stuart and Annie Brown lost their St. John's home in a house fire on Dec. 23, 2013. While the couple assumed they would be covered for the value of all the contents in their home, including certain antiquities collected from around the world and valued at $396,000, the Browns were out of luck.

Johnson Insurance only offered a quarter of that amount.

Orr said the limitations apply for items such as stamp collections (usually $1,000) and coin collections (usually $500), unless extensions are purchased.

Sewer backups, earthquakes not covered by basic policies

People are often surprised to learn that a sewer backup isn't included in their basic policy, but only through a specific policy extension.

Up until a few years ago, sewer backups were a part of many basic policies.

"Overland flooding is the kind of natural catastrophe that's sometimes considered beyond the capability of a company to respond to," Maltman said. "Earthquake insurance is similar. One earthquake could wipe out the industry."

Despite the fact sewer backup was not covered for many customers, RBC Insurance decided in 2013 to pay Albertans for damages related to the catastrophic summer flooding.

Maintenance exclusions

Poor upkeep of property can be grounds for denying a claim.


Brian Maltman, executive director for the General Insurance Ombudservice, advises anybody travelling for more than a couple of days to have a friend or relative check in on their home every day to make sure the heat still works. (Courtesy Brian Maltman)

That's because a home insurance policy is not a "a maintenance policy," says Pete Karageorgos, director of consumer and industry relations with the Insurance Bureau of Canada. 

Though some natural hazards can't have been avoided, other problems could have been taken care of in the first place. 

"If there's cracks in your foundation, well, your home is not built so that water seeps into your foundation," Karageorgo says. "That's a maintenance issue, not an insurance issue."

The same goes for damage inflicted by household pests. If critters have gnarled away at the attic to the point where a new roof is needed, standard insurance won't help much. 

"Toronto is undergoing the war with the raccoon now, but damage done by that raccoon, or a squirrel, or any sort of vermin to a person's home has an exclusion there," Karageorgos said.

Upgrades could affect policy

A few renovation or remodelling projects at home can also have big consequences on your insurance policy, Karageorgos says.

Christmas fire leads to year-long insurance coverage battle

The front of the Browns' St. John's home after it was gutted by fire last Christmas. (Stuart and Annie Hall)

"If you're adding living space by finishing your basement, you're adding value and costs," he says. "You need to let the insurance company know you've updated the countertops, put in natural stone or upgraded the cabinetry."

Extensive alternations can also change the policy classification, bump up the replacement cost of your home, or lower premiums.

"If you have a bigger home than what you've told the insurance company you had, when you have a claim and the insurance company discovers that material change in risk, that's a no-no," Karageorgos said. "The company may decide not to pay the claim, or they may cancel your policy, or pay the claim and deduct what the additional cost of insurance would have been had you been honest with them from the word go."

Insurance brokers strongly recommend home owners carefully dig into their property insurance policies to find out what they're covered for. Anyone with questions can also consult the Insurance Bureau of Canada, or take up grievances with the General Insurance Ombudservice.