Most of us take our homeowners insurance policy for granted. We pay the premium and expect that, in the event of a loss to our home, we will be covered.
But do you really know which items your homeowners policy covers and what it excludes?
A standard homeowners policy covers damage to the house for all perils except listed exclusions. Those exclusions are often very important. For example, the ordinance and law exclusion means there is no coverage for the costs associated with upgrades required by new building codes. So if a part of your home is ruined by a storm, a fallen tree, a fire or some other disaster, your insurance will pay to rebuild it to its original condition. If your locality has improved its building codes to require better materials—or even environmentally friendly systems—you might have to pay out of pocket if your policy hasn’t been upgraded.
Earth movement, water backup, power failure, neglect, war, nuclear hazard, intentional loss, and governmental action are all things that are typically excluded from a standard homeowners policy. Jewelry, fine art, antiques, collections and firearms may also require a special addendum to be protected by your insurer.
Things to consider include whether home is in a flood zone or prone to flooding, if sinkholes or earthquakes are common in your area, and if your home is near a nuclear power plant.
Don’t just leave your home’s protection on autopilot. Talk to your insurance professional about the details of your policy to make sure you have the coverage you think you have.
