What Home Insurance Should You Have to Host a Christmas Party?

Hosting an at-home party this holiday season? Aside from gifts, decorations, and refreshments, you may want to consider adding a home insurance policy review to your list of to do’s. 

Does home insurance cover you when hosting a holiday party?

Having a few friends over won’t void your home insurance policy – the question is whether you have the right coverage in place. And do you have enough of it?

Potential risks of hosting a party at home

Although having to make a home insurance claim because of a party may seem unlikely, it’s always a good idea to protect yourself ahead of time. To ensure you have the right coverage in place, think about the potential risks your party may cause or incur – here are a few examples: 

• Dog bites
• Kitchen fires
• Food poisoning 
• Slip and falls in or around your house
• Children damaging your furniture
• Guests stealing expensive items
• Injuries/damages due to alcohol consumption (e.g. DUI accident)

What does your standard homeowner’s insurance policy cover

So does your homeowner’s policy cover all the potential risks of throwing a party? A standard policy provides two different types of home insurance coverage: property and liability.

Property coverage

Property coverage protects you financially from damage claims to your physical home or its contents. For instance, if a guest accidentally starts a house fire while using your oven to heat up appetizers, your policy can step in to help pay for the repair of your kitchen. And if the damages make your home unlivable, it can even provide payment for a temporary place to live (e.g. hotel). 

However, it’s important to understand that your property coverage also comes in three different levels: basic, broad, and comprehensive (most popular). Depending on the level you purchase, you may or may not be covered for certain risks of property damage. 

• Basic coverage – only protects your property from selected risks (e.g. fire, lightning) 
• Broad coverage – protects your property from risks of damage and loss; protects your contents from selected risks (e.g. theft)  
• Comprehensive coverage  – protects your property and contents from all risks, with the exception of optional coverages (e.g. flood insurance coverages)

So be sure to check that the level of coverage on your policy matches with the risks you want to be protected against. You wouldn’t want your expensive jewelry stolen at a house party, only to find that your basic home insurance policy will not cover the replacement of stolen contents.

Liability coverage  

Third-party liability coverage, on the other hand, protects you financially from third-party claims of property damage or bodily injury. So instead of paying for you to repair your own home, it can pay for any legal expenses and repair costs if you accidentally damage your neighbour’s place or are sued by a guest of your home. It can also cover the cost of medical expenses if someone is injured in your home. 

Unlike your property coverage, liability coverage doesn’t typically come in different levels, and it should already be included in your home insurance policy. But what can control is the amount of liability coverage you get - it’s recommended for most homeowners to have at least $2 million in coverage. So if a guest injures themselves on your icy driveway, your policy can protect you financially – you just need to make sure you have enough coverage in place. 

How much home insurance coverage do you need for a party?

The amount of coverage you should have on your home insurance policy before throwing a party depends on the level of risk your party brings. Generally speaking, the more guests you invite, the higher your coverage limit should be – any person attending the event could hold you financially responsible for their actions. 

You should also consider the type of people attending your party. Are they family members or close friends? Your parents probably won’t be stealing your electronics or suing you for food poisoning, but a room full of plus ones could be a different story.

If you’re looking to upgrade the limits on your current home policy, be sure to speak to a licensed home insurance broker – mentioning specific details, such as the guest list and whether you’re serving alcohol, can help you find out the exact amount you should carry.

Do you need event liability insurance for a party at home?

Although special event insurance isn’t a requirement for at-home parties, you should still consider making the purchase if you’re throwing a larger celebration, such as a wedding. Instead of upgrading your current home insurance policy just to accomodate a party, event insurance provides you with one-time extended coverage of $1,000,000 to $5,000,000 – to be used for third-party claims of property damage or bodily injury. And you may even be able to reimburse the cost of the party if you end up cancelling. 

Host liquor liability insurance

As a host, you could be held liable for a guest’s actions if they’re under the influence of alcohol that you served. Depending on your insurer, the liability coverage on a regular home policy could cover alcohol-related claims, but there are often limitations to the protection – that’s where host liquor liability insurance comes in. 

Let’s say a guest leaves your party intoxicated, driving under the influence of alcohol. If they injure a pedestrian on their way home, you could be held liable for the legal expenses and medical fees. Having host liquor liability insurance protects you financially, even if your home policy can’t. 

If you’re not sure whether you need host liquor liability added on top of your home or event policy, speak to your insurance broker for more details. Keep in mind, however, that you do need a liquor permit (special occasion permit) before you can access this type of coverage.

How to prevent home insurance claims when hosting a party

Although having the correct coverage in place is important, avoiding home insurance claims altogether is probably the best thing you can do to ensure your protection. Throwing a party doesn’t need to be full of risk, especially if you take proactive measures, such as:

• Clearing your sidewalk
• Shortening the guest list
• Assigning designated drivers 
• Limiting alcohol consumption
• Providing a place of stay overnight 
• Hiring a professional bartender (with their own alcohol liability protection)

Home insurance considerations for hosting a party during COVID

Does home insurance cover COVID-19?

This can vary depending on your insurer, but many home insurance policies have a communicable diseases exclusion. This means you won’t be able to make a claim if you’re sued for transmitting a disease, such as COVID-19, in your home. 

Can you be held liable for COVID-19 transmission?

For Ontario homeowners, Bill 218 was passed in November 2020 stating that damages can't be pursued against someone who passes on the coronavirus – as long as public health measures and government laws were followed, and it wasn’t an act of gross negligence (e.g. knowingly undisclosing symptoms). 

COVID-19 capacity limits and your home insurance 

It’s especially important to stay within the capacity limits of public health guidelines during this time as it’s possible for insurers to void your policy for breaking the law. In phase three of Ontario’s reopening plan, only a maximum of 25 people are allowed to gather indoors for an event. So if you’re planning to throw a holiday party, be sure to keep the guest limit tight – you wouldn’t want to be responsible for thousands of dollars in damages, just because you invited a few too many friends over. And aside from worrying about your claim, you could also face a maximum conviction of up to $10,000 for hosting a gathering over the capacity limit. 

The bottom line

Parties are already expensive as-is, so the last thing you want to deal with is the added financial burden of being underinsured. So be sure to double-check your home policy to ensure you’re adequately protected from all the potential risks ahead of time. 

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