Common Service Issues Not Covered by Homeowner’s Insurance
Buying your first home comes with a lot of surprises . While most buyers are willing to sign up for homeowner insurance, they often overestimate their coverage. There are a number of unexpected things that your homeowner’s insurance won’t cover, and in the event of an emergency, you don’t want to be caught off guard. Here are some common events not covered by your policy.
Earthquakes and floods
Okay, depending on where you live, earthquakes and floods may not be common, but still worth noting.
Your homeowner’s insurance does cover most natural disasters like tornadoes, lightning strikes, or even volcanic eruptions. As the Insurance Information Institute notes, earthquakes and floods are usually a different matter. In fact, here’s a handy chart in which they detail which disasters are really covered:
You can purchase separate flood insurance from private carriers or from the National Flood Insurance Program . And if you live in a designated flood area, flood insurance may be required (you can find out if you are in a flood area using FEMA’s online flood map ). Most insurance policies also include an addition to earthquake insurance if you do not live in California. The California Earthquake Authority deals with this type of insurance, and it is offered under a separate policy.
Mold and termites
Mold and termites are common problems that homeowners face. Unfortunately, both types are usually excluded from your policy for the same reason: they are usually considered damaged due to lack of maintenance. Most policies will at least limit coverage, if not exclude it entirely.
You must be extra vigilant about prevention. For example, if you have leaking pipes or flooding, be sure to nip them in the bud and clean them out completely to prevent mold growth.
If you are renovating your home, you might even consider using mildew-resistant drywall. Mold removal company GTA Mold Removal explains :
Traditional drywall consists of a plaster base sandwiched between layers of paper. Mildew-resistant drywall is paperless – the gypsum core is covered with fiberglass, which makes the surface very water-resistant. Moisture resistant drywall is especially valuable in areas that are exposed to moisture, such as bathrooms, laundries, basements and kitchens. Traditional drywall is not only more susceptible to mildew than paperless, but mold is also difficult to get rid of, and removal and replacement can be expensive. Mold-resistant drywall is also available; the drywall core is designed to prevent moisture absorption and thus prevent mold growth.
To prevent termites, check your home periodically with a professional. Most experts suggest checking every couple of years . Once the termites spread, they can cause severe structural damage, which can cost over thousands of dollars to treat and eliminate. Catch them as early as possible and you can limit the damage.
Sewer backups and pipe ruptures
Your standard insurance policy probably doesn’t cover sewer backups (but you can purchase one separately for about $ 50 a year ). However, most standard policies will cover your expenses if you have to live elsewhere because your home is uninhabitable. The Insurance Information Institute informs :
For homes that have been severely damaged and unusable, homeowners’ policies may include loss of use coverage, which includes reimbursement of living, food, and other living expenses that you may incur as a result of living outside your home. Houses. Loss of use insurance also reimburses you for lost rental income if you rent out part of your home.
On the other hand, burst pipes are often your standard policy. However, if your insurance company determines that the damage was due to your negligence, they may not cover you. For example, if your home is leaking slowly and you are delaying repairing it, the insurance company may consider it negligence. Similarly, it is therefore important to protect pipes from freezing in winter and protect them while traveling. If your pipes burst and the insurance company decides that you have not taken care of them properly, you may be out of luck.
Dangers to the home office
Maybe you have a bedroom that you use for a home office or a converted garage used for running a business. Whatever your home office is, don’t expect a homeowner’s policy to cover your business expenses. Bankrate explains :
If your inventory catches fire in the garage, forget about it. Unless you have home business insurance that specifically covers your home business, you are on your own.
“If a person is doing business away from home, they cannot rely on the homeowner’s policy to provide coverage,” says Jeff Olmsted, assistant vice president of small business underwriting at Hartford Insurance.
Your insurance will likely cover damage or problems related to the home itself, but usually, you will need separate business insurance to cover your work-related costs. However, some politicians offer “business support”. For an additional $ 25-50 a year, you can get insurance coverage for things like your computer or perhaps even contingency liability insurance , Bankrate adds .
Some questions of responsibility
Let’s say your seemingly harmless German Shepherd bites an Amazon delivery man and now needs stitches. This happens: According to the Insurance Information Institute, dog bites account for more than a third of all homeowners’ insurance claims . The problem is that some rules exclude certain dog breeds, which means that you are responsible for any dog bite problems and claims. Check out your policy and see if your dog is insured . Otherwise, you should be careful about his behavior.
Trampolines, treehouses and pools are other challenging areas. Some rules specifically exclude injuries from trampolines , and while pool injuries are usually covered, there is probably a fine print in the policy. For example, in some cases, if you have a diving board installed , the coverage is zero. It’s the same with the tree houses. They are considered high-risk structures, so many policies exclude them, or at least include details on how to install them. You will definitely want to read your policy and find out what is covered if you have any of these items in your home.
However, this is a good general rule of thumb for all of these cases. Standard homeowner insurance, of course, doesn’t cover everything. When you know what is included and what is not, you will be better prepared and able to plan accordingly.