As the effects of global warming become more commonplace, so too will the risks associated with it. Whether an ice storm causes power outages or a summer storm smashes a tree into your power lines, dealing with a blackout is never fun. An extended power outage will have you dealing with the impact of spoiled food within your fridge and freezer. The threat of losing hundreds (to thousands) of dollars in food wastage is enough to cause concern for all of us. Though it may feel like a loss you have to bare alone, food spoilage (in some circumstances) may be covered by your home insurance policy. Let’s take a look below.

The cost of food prices is soaring

Canada’s economy might be recovering from the pandemic, but many Canadians are still struggling with the cost of living. This is thanks, in part, to the impacts of global inflation. The average family of four will spend up to $16,288.41 on food this year, according to the latest Canada’s Food Price Report. Published by the Agri-Food Analytics Lab at Dalhousie University, the study states that, “For a family of four, their food bill will increase by about $1,100 this year,” according to the lab’s director, Sylvain Charlebois. In light of the recent food price increases, making sure we keep our food stored safely is a priority, now more than ever.

When does homeowners insurance cover food spoilage?

  • Most homeowner’s policies include coverage for frozen and refrigerated food that spoils during a power outage. However, this is only if a covered peril causes the loss of power.
  • If lightning strikes your house and causes a power surge that fries your refrigerator, homeowner’s insurance may cover food spoilage in this instance. You’ll have to double check the details within your policy with your isure broker.
  • If a windstorm blows a tree down in your yard and knocks out the power, your homeowner’s policy may help pay to replace the food if it goes bad in your fridge or freezer.
  • If an electrical grid failure causes the power outage and food loss, your insurer may not be the one picking up the tab. In this instance, it’s worth asking your utility company if they’re able to pay you for the loss.

Some utility companies provide food spoilage reimbursements in instances where they’re at-fault for the outage. Check with your utility company to see if this is the case.

How insurance companies cover food lost in a power outage

Among home insurance policies that cover spoiled food, specifics vary from policy to policy. Some policies have a coverage limit for food spoilage, such as up to $2,000 for spoiled freezer food. Others require that the home insurance deductible be paid before coverage for spoiled food kicks in. Depending on the provider, a home insurance policy can be without a deductible. However, filing a claim for food spoilage is likely to lead to an increase in your insurance rate. It’s up to the homeowner to decide on whether it makes financial sense to file a claim for food spoilage.

Here are examples of coverages offered by some of our affiliate insurers:

Aviva Canada

Aviva Canada, covers food spoilage “caused by the accidental interruption of electrical power on or off the premises or by mechanical breakdown of the freezer.” So, unlike SGI Canada below, its policyholders will likely receive reimbursement if a fallen tree cuts their power lines. Both insurers’ policies come with exclusions: Aviva won’t cover spoilage caused by a faulty circuit breaker or fuse issue. SGI won’t cover losses as a result of natural spoilage, renovating a large walk-in freezer unit, manual disconnection of the power supply, or carelessness on the policyholder’s part. Neither will cover expenses incurred when buying the food.

SGI Canada

The cause of the power outage may determine whether or not your insurer will cover the loss. SGI Canada, will pay up to $1,000 for the loss or damage of frozen food “when caused by accidental interruption of electrical power away from the premises or mechanical breakdown of the said refrigeration unit(s).” It will cover food damaged as a result of natural disasters, like the Alberta floods or the nasty ice storm that hit Toronto in December 2013.

Economical Insurance

Economical‘s food spoilage coverage is designed to protect you if the contents of your fridge or freezer are spoiled because of a power outage or technical malfunction. This coverage is included in most standard home, tenant, and condo insurance policies. Food spoilage coverage only covers spoilage as a result of a power outage or a malfunction in your fridge or freezer. If you’ve accidentally unplugged your freezer or left the door open, you won’t have coverage.

How long does food last in a power outage?

Once cut off from their power source, full freezers will keep food cool for about 48 hours if it remains closed, and 24 hours if the appliance is only half full. Homeowners should avoid eating any previously frozen item if its temperature has reached 4°C for four or more hours.

Homeowners should also be aware that raw or cooked meat should only be frozen once. If it thaws due to a power outage, do not return it to the freezer once the power comes back on.

When does homeowner’s insurance not cover spoiled food?

A standard home policy will list the perils that are excluded from coverage. Power outages caused by any of the following events are also excluded:

  • Flood will not be reimbursed for any food loss or damage to your home and personal property
  • Earthquakes or any form of earth movement
  • Negligence, like if you forget to pay your power bill and your electricity gets shut off
  • Wear and tear over time
  • Certain causes of a power surge, like poor installation
  • Equipment breakdown, like if your refrigerator suddenly goes kaput

For additional protection for your appliances, consider adding equipment breakdown coverage to your policy for an additional premium. This endorsement covers appliances that break down due to mechanical or electrical failure.

How to file a food spoilage claim

When submitting a claim for food spoilage, you’ll need to provide proof and documentation. It’s just as you would with any other personal property claim. It’s a good idea to have the below information handy:

  • Receipts or bank statements of the food purchase
  • Pictures or videos of the damage that causes the loss and of the spoiled food itself
  • An estimated cost of the food if you don’t have all the receipts

You can typically file a claim with your homeowners’ insurance company over the phone or online through their website. If your claim is approved, a claims adjuster may visit your home to investigate the damage to confirm the legitimacy of your loss before reaching a settlement. It is also likely that photos or videos of the spoiled food and damaged equipment will be requested. Finally, insurance providers may also request bar codes for each food item and/or receipts in order to gauge the value of the spoiled food.

Does renter’s insurance cover your spoiled food loss?

Yes, most tenant insurance policies will cover food spoilage under the contents coverage aspect of the policy. However, as with home insurance policies, food spoilage coverage is only likely to kick in if the damage is due to a covered peril. This may include fire, wind or lightning. If food spoils because an old fridge breaks down, coverage won’t be available.

Does your condo insurance cover your spoiled food loss?

Yes, most condo insurance policies cover food spoilage under the contents coverage aspect of the policy. As with home insurance policies, coverage kicks in based on the cause of the power outage. For example, a condo owner will not be eligible for food spoilage coverage if you accidentally unplug a freezer. On the other hand, if there’s a power outage in the neighbourhood for long enough that food spoils, coverage will be available.

How much is the average reimbursement from home insurance for spoiled food loss in a power outage?

Coverage limits for food spoilage will vary between policies. Most coverage limits are typically between $1,000 and $2,000. Some require that a deductible be paid. It’s important for you to carefully weigh the pros and cons of filing such a claim. In some instances, filing a claim can result in a higher premium in the future, which may not be worth it.

The bottom line on food spoilage and insurance

A quick call to one of our isure brokers is all that is needed to review what coverage you have and the rules that are in place on your policy. Once you know you have coverage, it’s up to you to determine if the cost to replace the food is worth submitting the claim. Claims under $1,000 may not be worth experiencing a home, condo, or tenant insurance rate hike. Regardless of your decision, it is not an easy time dealing with a long power outage. So, prepare for all scenarios and make the smart financial decision at the end of the day that’s right for you.

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