Posted at 6:00 a.m.
Inheriting a house and the challenge of securing it
We are in the process of succession and the insurance of our deceased mother’s house will soon end. The insurance company refuses to renew, claiming that it is deemed unoccupied. However, we spend a lot of time there to dispose of movable property. How is this different from a chalet that is not occupied full time?
Peter G.
Properties can be classified into four categories, explains Michel Verrier, senior director of Alpha Assurances: primary, secondary (accessible 12 months a year), seasonal (accessible only part of the year) or vacant.
In the case of an estate, residence falls into the fourth category.
Moreover, the liquidator has the duty to inform the insurer of the change of status that the death causes.
“You have to obtain a vacancy permit from the insurer to meet the requirements of the contract,” adds Mr. Verrier. If an insured does not notify the insurer of a vacancy, he risks facing a nullity of policy. Each company is free to accept or not, but according to Mr. Verrier, the answer will be positive 80% of the time.
The Insurance Bureau of Canada (IBC) also says that insurers “generally agree” to keep the policy. But nothing obliges them to do so.
In addition to a possible refusal, it is necessary to expect that the price and the conditions change, and this, in a significant way. Because a vacant house represents an increased risk.
“In addition to the risk of theft and vandalism, if an event causes damage (burst water heater, freezing pipe, tree collapsing on the house), no one will be able to see it quickly and take the necessary steps to prevent them from getting worse, ”explains BAC spokesperson Anne Morin.
To “secure themselves”, explains Michel Verrier, the insurer may, for example, remove the replacement value, reduce the number of protections, require the maintenance of the alarm system or the closing of the water inlet, claim of the “caretaker” (someone who comes every three days), increase the price of the policy and the amount of the deductible. “A deductible of $10,000 is common for unoccupied houses. In addition, in estates, insurers are very reluctant to offer protection against sewer backup. »
At Desjardins, specific risks (damage caused by fire, lightning, smoke, hail or strong winds) are normally maintained. On the other hand, any damage related to water, fuel oil, theft or vandalism, in particular, is excluded, specifies the spokesperson for the cooperative, Valérie Lamarre.
To obtain better conditions if you inherit a vacant house, Michel Verrier suggests contacting his own insurer. Since he knows us, he should be more inclined to be accommodating, he justifies.
“Desjardins Insurance will be open to offering insurance coverage if it also insures the principal residence of the applicant,” confirms Ms.me Lamarre.
If you are having difficulty finding an insurer for a vacant property, BAC offers an assistance service. “Our mechanism provides, in the case of an estate, that the designated insurer provides coverage for a minimum period of six months. Note that we do not intervene on the amount required, ”says Anne Morin.
The interest of knowing the interest on credit cards
PHOTO MARTIN TREMBLAY, PRESS ARCHIVES
Interest rates are higher for a cash advance than for credit card purchases.
I would like a simple explanation of the calculation of interest on a credit card balance. I had a balance of $757, I made a payment of $700. I had to pay almost $20 in interest. I thought we were paying interest on the outstanding balance.
Francine C.
Even if credit cards are part of our daily lives, the calculation of the interest charged is often misunderstood, notes Johanne Le Blanc, budget advisor at Option consommateurs. “Interest is calculated on the total purchases, even if we reimburse most of them. It’s a surprise, something that people discover when we give training. Most people do not suspect this. »
So even though Francine paid her balance almost entirely, Francine’s credit card issuer charged interest on $757. In addition, the calculation was made from the day the purchases were posted to the account. As the contracts indicate, to benefit from the famous 21-day grace period, you must necessarily repay your balance in full.
“It shows how there is an exponential dimension when you don’t pay the balance in full,” recalls Mme The White.
Remember that in the case of cash advances, there is never a grace period. In addition, the interest rate is higher than that for purchases. This type of loan should therefore be taken as a last resort.
Those who do not always pay their balance – 30% of the population, according to the Bank of Canada and a recent Scotiabank survey – should therefore favor cards with reduced interest rates (between 9 and 13%). There is a panoply of them, and comparisons can be easily made online on these four sites, in particular.
Low-rate cards have another advantage: small, if any, annual fees.
If you’re carrying a large balance, some cards also entice new customers by offering a miniscule interest rate for a few months, which can help get rid of debt. For example, BMO Prime currently offers a 0.99% interest rate on balance transfers for nine months. A 2% transfer fee applies.
Looking for a low-rate card is especially smart in these inflationary times that are driving up spending. According to Equifax, Quebecers increased their credit card purchases by 18.4% in the first quarter compared to the same period in 2021. In addition, the average credit card balance in the country is up 9.5% .
Does cash still matter?
PHOTO PATRICK SANFAÇON, THE PRESS
As of February 2022, agents in Montreal metro stations no longer accept cash payments.
The money changer in the subway refuses to take my $6.50 in cash for my return ticket, telling me that for cash, I have to use the machine to buy my fare. He only takes Interac. As far as I know, a merchant cannot refuse to be paid in cash, right?
Robert P.
Indeed, since February 2022, agents in metro stations no longer accept cash payments. Only debit or credit cards are accepted.
If you want to pay cash, you must use the ticket vending machines.
At the start of the pandemic, the STM had temporarily withdrawn the cash payment option and its customers then adopted new habits, explains spokesperson Amélie Régis.
“Before making its decision permanent, the STM surveyed its customers in the fall of 2020 to ensure that it was meeting their needs and avoiding a negative impact on their experience,” she explains. The exercise made it possible to determine that only 4% of customers in the regular network do not have a bank card.
As for the question of the legality for a company to refuse cash, it had arisen in particular during the opening, at the Eaton Center in Montreal, of the Decathlon store and the Time Out Market food court. Both only accept electronic payments.
The Bank of Canada then confirmed that sellers are entirely within their rights to determine which payment methods they accept.
A company can therefore set its own rules and refuse cash, checks or cards. It can also refuse certain denominations such as $100 bills, for example. The Consumer Protection Act however, prevents merchants from charging additional fees when paying by card.
In January 2020, Option consommateurs published a report calling on Ottawa to change the Currency Law so that it is forbidden to refuse cash. “The disappearance of cash payment exposes consumers to many privacy and budget management risks,” argues the consumer advocacy organization. In his opinion, seniors, low-income consumers and less educated people are particularly disadvantaged by the proliferation of businesses that refuse cash.
In a 71-page report on the issue, Option consommateurs summarizes the comments gathered in the focus group as follows: “Consumers said they would like cash to remain in circulation in Canada, even if they prefer to use electronic payment methods . […] Consumers are upset when merchants refuse their cash […]. Consumers want to be able to choose how they pay and consider it illegitimate to have this democratic mode of payment taken away from them. »