According to Bankrate, 1 in every 20 insured homes makes a yearly claim. That means you are likely to make an insurance claim this year. Yet you may miss potential benefits if you don’t know what home insurance covers. Discover nine things that are covered by your home insurance so you can make an informed decision. Let us jump right in.
1. Theft and Vandalism
According to the FBI, there’s a burglary every 30 seconds. Of course, this is the average number, and you may live in a relatively safe neighborhood where burglaries are less common. So, you can’t rule out its likelihood. Luckily, burglary is one of the nine things that are covered by your home insurance. If an intruder steals or damages your items, such as jewelry and electronics. You may get a discount on your home insurance if you put in place security cameras that can lead to identifying burglars.
Vandalism is a special type of break-in. An intruder intentionally damages your property and assets. Vandalism is common during periods of civil unrest. For example, teens can throw stones on your roof, leaving significant damage. Your home insurance will cover roof repairs depending on your claim amount. Sometimes it’s graffiti on your wall, but vandalism can leave extensive damage, such as broken windows.
While home insurance will cover most of the damage caused by theft and vandalism, there may be exceptions. It’s crucial to read the fine print on your home insurance to know if you’ll need additional insurance. High-value items like fine art, luxury jewelry, and collection pieces may need additional insurance.
2. Personal Injury
As a property owner, you can be liable for personal injuries to individuals on your premises. It’s called premise liability. Your liability will depend on the extent of your role in the injury. Hazardous conditions and negligence are the most common reasons for premise liability. For example, if you didn’t call in an emergency tree service, a tree accident on a neighbor makes you liable. Premise liability includes slips and falls, swimming pool accidents, and electricity burns.
A personal injury claim can leave with unexpected medical and legal expenses. Luckily, premise liability is one of the things that are covered by home insurance. Home insurance gives you financial protection in the event of a personal injury. Without it, you would have significant financial burdens of personal injury lawsuits. It’s a way of safeguarding ourselves from unexpected accidents and responsible home ownership. Knowing what kind of personal injuries your home insurance covers can be time-saving.
Most home insurance companies will cover intentional injuries and faulty maintenance accidents. However, this coverage has limitations. For example, it doesn’t cover intentional harm, illegal activities, and restricted high-risk activities. As a rule of thumb, you should review your policy for explicit inclusions, limits, and exclusions. Once you have grasped what will be covered, you can consider extra umbrella insurance policies for additional coverage.
3. Certain Natural Disasters
Most home insurance policies cover natural disasters. However, they specify which natural disasters they cover and to what extent. They may cover windstorms, hailstorms, or lightning strikes. It can also extend to damage caused by falling trees, flying debris, or structural damage. Since coverage differs from policy to policy, reviewing the policy is essential. Thus, you can make informed decisions, such as adding another policy.
There are different types of natural disasters in which you can make an insurance claim. One of the most common disasters covered by home insurance is windstorms. In this category, policies cover roof damage, broken windows, or structural damage. In the hailstorms category, coverage may include damaged roofs, windows, and siding. A policy may also cover flood damage restoration costs after heavy downpours. Lastly, a home insurance policy covers damage caused by lightning strikes.
Although natural disasters are one of the things that are covered by your home insurance, you should read the fine print. Every policy has its inclusions and exclusions. Understanding your limits helps you appreciate what to expect and make plans for the future. Sometimes a policy may reject your claim because you didn’t follow certain codes and maintenance practices to weatherproof your home.
4. Fire Damage
According to the Zebra, 358,500 fires happen each year in America. Half of these incidents start in the kitchen. Even with a quick response from the fire department, fire damage can set you back financially. Adequate coverage is essential for recovery and rebuilding after a devastating fire incident. It will help you replace your belongings and repair the damage. You may also have to call a professional, such as a plumber, to repair the damage. Coverage extends to structural, smoke, and water damage from the firefighting efforts.
While fire damage is one of the things covered by your home insurance, it’s essential to fireproof your home. Your insurance policy may not cover every damage, and you may also lose irreplaceable items to a fire. So, engage the services of a fire prevention specialist. They may recommend adding fire extinguishers and installing smoke detectors. An electrician can inspect your appliances, especially in the kitchen. Your home insurance company may offer discounts if you take such measures.
You should also note that home insurance may not cover all types of fire. For example, if the fire resulted from illegal activities or intentional practices, the policy may not apply. Also, home insurance may not cover fire damage to high-value items such as fine art. Therefore, you may need an extra policy. It would be best to talk with an insurance agent to understand the scope of your policy.
5. Personal Belongings
Personal belongings are some things covered by home insurance. These include furniture, electronics, clothing, and assets. Your home should be the safest place for your valuables, but unexpected circumstances can change that. Home insurance doesn’t mean you’ll get the exact replacement for damage or loss of personal belongings. Yet it can offer some much-needed financial relief for worthy compensation.
Before taking a home insurance policy, you must understand how companies determine your claim. They use Actual Cash Value (ACV) and Replacement Cost Value (RCV) so you can choose a suitable policy payment. For example, should insurers pay you ACV or RCV if intruders damage your garage door? With the RCV, your policy payout would be the cost of replacing a similar but new door. If you have high-value items, engage a professional to do appraisals.
Your insurance coverage will only apply after you have paid a certain deductible amount. So, ask the insurance company how much you have to pay upfront. If you have not had an incident, familiarize yourself with the claims process. If an incident happens, such as a break-in, keep the evidence. Take photos and receipts that prove your claim. Also, let the insurance company know about your issue immediately so you can get an immediate response.
6. The Home Structure
The whole point of home insurance is to cover the home. That’s why the structure itself is one of the things that are covered by insurance. The structure includes the walls, roof, and foundation. So, if a flood damages your foundation, your home insurance will cover the repair costs according to the policy. Similarly, if vandals damage the roof, your policy would cover the costs of engaging roofing contractor services. You should consider your policy’s dwelling limit to ensure your home has adequate cover.
If you recently did home renovations, inform your insurance provider. A home upgrade increases the value of your home. So, informing the provider helps them make a proper risk assessment to ensure your dwelling coverage limit will cover you. Also, some upgrades, such as a swimming pool or solar panels, may need an additional policy. Talk with the insurance provider to know how renovations have changed the premiums.
Another aspect to consider is building code renovation and compliance requirements. Since these codes keep evolving, you may have to upgrade. For example, certain circuits are outdated and more prone to electric fires. Your policy may have relevant information on the cost of complying with the current building codes.
7. Loss of Use
Loss of use coverage reimburses you for extra costs you incur when your home becomes uninhabitable. The loss of use coverage applies for temporary displacement and only for a cause covered in your policy. It covers expenses such as temporary accommodation, meals, and transport. For example, if a major tree falls on your house, you can move to a hotel before the tree removal company fixes the problem. The insurance company will cover your expenses because the policy covers damage caused by water leaks.
Before you can count on the loss of use coverage, ensure you are eligible. That’s because coverage is subject to limits and certain exclusions. Your limit is a percentage of your dwelling coverage limit. So, you should assess your limits. Also, check your covered expenses on the policy. Does it explicitly say your rental and moving costs are covered? Some companies will only limit expenses to three. Ensure to keep meal and transport receipts because they’ll help you in the claim process.
Understanding the claim process to prevent delays is essential. In our example, if arborists determine you have a tree problem that makes your home inhabitable, you should inform the insurance company. You’ll be eligible for compensation if your policy covers such tree problems. Still, you’ll need proof, so keep the photos of the tree and its extensive damage to the house.
8. Additional Structures Coverage
Many people need to learn that detached structures are some of the things that are covered by your home insurance. These include garages, car sheds, fences, gazebos, and separate guesthouses. So, when these structures are damaged, they go back into their pockets to pay. You should know that your home insurance covers these extra structures, although coverage may vary from policy to policy. For example, if a fire damaged your detached garage, your policy may cover a part of garage door company costs.
Detached structures vary, so the policy may not cover all types and for all types of perils. Instead, policy exclusions, inclusions, and limits apply. The company may also not cover certain natural disasters. For example, the policy may not cover if your cabin structure gets carried away by heavy floods. Yet, in the same case, the policy may cover foundational damage in the garage.
As always, talk with your insurance agent to understand every aspect covered in the policy. Some people spend years pursuing claims because they didn’t read the fine print. You may have options if an essential part of your additional structures is not covered. For example, you can get policy riders to increase your coverage limit for specific perils. Discussing with your provider helps you know your options.
9. Liability for Pets
According to the Center for Disease Control and Prevention(CDC), 4.5 million people are bitten by dogs annually. Since most of these cases occur at homes, the homeowner is liable. Other people keep pets with more lethal effects than a dog bite. These injuries by pets can cost thousands of dollars in medical and legal bills. Home insurance will cover the liability of such injuries. While liability for pets is one of the things that are covered by your home insurance, you can take some measures to protect yourself from such liabilities. Some people put up fences, and others engage in waste removal services to reduce the risks of accidents.
Liability for pets may also include property damage caused by pets on your property or other people’s property. For example, if a bulldog caused significant damage to someone’s kitchen garden, your home insurance policy may cover it. The trick is to understand your policy limits.
To bring it all together, home insurance covers multiple aspects of a home. Yet exclusions and limits can mean you can’t make a certain claim. The best strategy before buying home insurance is to understand things that are covered by your home insurance. Sometimes it may be helpful to have an insurance attorney go through the policy for you.
