You’ve worked hard, saved your money and bought a home. Now you want to protect the largest investment you’ve ever made with homeowners insurance. You’ll sleep better knowing that your insurance will help you rebuild if there’s a fire, tornado or a tree falls onto your home. What you may not know are the many things homeowners insurance won’t cover. Your sweet dreams of protection could turn out to be a nightmare because you don’t have the coverage you thought you did.
Here are five things not covered by most home insurance policies:
- Earthquake and land movement. As landslides and earthquakes have become more common in many states, people are surprised to learn that earthquake or land movement damage is not covered by standard homeowners insurance. You need to purchase separate earthquake and landslide insurance protection.
- Floods. Numerous polls have found a majority of homeowners and renters thought their property insurance protected them from flooding; it doesn’t. If a river overflows its banks or a storm surge sends tides into your home, you’ll need to have purchased separate flood insurance, provided primarily by the federal government. Keep in mind there is a 30-day waiting period before any flood policy can go into effect.
- Sewer backups. The sludge from a sewer backup can do serious damage and make your home unsafe until it’s properly cleaned up, but it’s not covered under most homeowner insurance policies. Your insurance company can provide a special endorsement to help pay for damage from sewer or sump pump backups. What you may not know is that homeowners are responsible for the maintenance of sewer and water lines through their property up to the sewer main, and many cities and utility departments will deny responsibility for most sewer incidents.
- Maintenance issues. A damage or injury claim could be in dispute if you fail to repair a broken step or other obvious hazards, ignore a leaking pipe, or neglect to remove dead trees and limbs.
- Expensive jewelry, fine art, firearms, musical instruments, furs and collectables. Too many people learn after a fire, tornado or burglary that their precious items only had minimal coverage. You’ll need special scheduled personal property coverage, often called a “floater,” to make sure they are protected for their full value.
The Property Casualty Insurers Association of America (PCI) also advises that almost two-thirds of America’s homes are underinsured because owners:
- Didn’t update insurance after remodeling or adding on
- Only purchased enough insurance to cover the mortgage
- Underestimated costs associated with updated building codes
- Didn’t factor in building material inflation in replacement costs
And, if you have a swimming pool, trampoline or certain types of dogs, you need to call your insurance company to make sure you are protected. Many insurance companies are starting to exclude them from policies or refusing to insure homes that have one or more of these.
Another important step is to do a home inventory. Nobody can predict when a fire or tornado might strike, but you can make sure your possessions are properly protected. A survey by the Insurance Information Institute found that half of American homeowners have not documented all the things they own. What does that mean to you? Completing a home inventory can speed up your claim and help you determine how much coverage you need. Items to include are:
- Electronics
- Personal care items
- Jewelry
- Art
- Kitchen items
- Furniture
- Carpeting
- Beds and linens
- Holiday ornaments
- Lawn and yard equipment and tools
Find an easy to use home inventory form here.
Your NEA Auto and Home Insurance Program provider, California Casualty, is ready to help. They can assist with your purchase of flood insurance, scheduled personal property and other special coverages, and provide a thorough home insurance review. They will find the professional discounts you qualify for as an NEA member: waived or reduced deductibles for vandalism or damage to your vehicle parked where you work, $500 coverage for non-electronic personal items stolen or damaged in your vehicle, and flexible payment plans including EZ Pay with summer or holiday skips. Learn more at www.neamb.com/autohome, or contact an advisor today at 1.800.800.9410.
Sources for this article:
http://www.iii.org/article/making-sure-your-home-properly-covered-disaster http://www.iii.org/insuranceindustryblog/how-many-homeowners-have-a-home-inventory/
