Dear editor:
Heritage homes are a defining feature of Niagara-on-the-Lake, but as Mr. Turner disclosed in his column last week, his annual premium of $8,600 illustrates that insuring them involves complexities that are not always immediately apparent (“The Turner Report: When old is not so beautiful”).
Considering the broader structural factors that influence coverage and cost helps put that figure in perspective.
Projected rebuild costs — not market value — drive premiums. Heritage homes are rarely standardized as they often require historically appropriate materials such as cedar shingles, stained glass, copper soffits, period architectural detailing, custom millwork and specialty masonry.
These materials can be more costly and more difficult to source than modern equivalents.
Because skilled trades familiar with historic restoration work are relatively uncommon, they often need to be brought in from outside the community and sometimes housed temporarily while working on the property, adding both logistical complexity and cost to a restoration.
In addition, heritage properties may involve compliance with conservation guidelines, municipal zoning bylaws and evolving building codes.
Conservation guidelines may restrict alterations to original facades, windows, rooflines or exterior materials. Municipal bylaws can govern setbacks, building height, lot coverage and the placement of a rebuilt structure on its lot.
At the same time, updated building codes may require modern structural reinforcement, electrical upgrades, or enhanced fire-safety standards when significant repairs are undertaken.
Together, these layered requirements demonstrate the complexity of heritage claims and can materially affect replacement valuations and overall rebuild costs — impacts that do not apply to modern structures.
There are also relatively few insurers who specialize in this niche market. In addition, these properties typically require specialized underwriting and restoration expertise, which comes at a premium due to the years of experience needed to become subject-matter experts.
As well, because their work is labour-intensive it is less suited to cookie-cutter software solutions.
Pricing is actuarially derived and reflects projected risk exposure, reconstruction complexity, and claims experience across an insurer’s broader portfolio.
Brokers commonly discuss the long-term implications of submitting a claim versus absorbing a repair cost. While the loss of discounts is certainly a consideration, multiple claims within a short period can also affect renewal terms or even result in the policy being non-renewed.
Although non-renewal is a serious matter for any policyholder, finding a replacement insurer for a heritage home can be especially challenging, given the limited number of providers, and the added complication of a non-renewal combined with a claims history.
Insurance is designed to protect against significant financial loss, not to eliminate all financial loss. Context matters. An important consideration is the deductible which is central to deciding whether to claim.
Once the deductible, the loss of discounts and the possibility of future losses are factored in, many policyholders reserve property claims for truly catastrophic events. The threshold will differ for each individual as that decision is inherently personal.
Heritage homes are an important part of Niagara-on-the-Lake’s charm and character. Understanding the unique challenges of insuring these properties helps us better appreciate the complexities involved in preserving and protecting them and helps place these costs in proper perspective.
Debra Rowe
NOTL
