Home insurance, also known as homeowners insurance, provides several benefits. It offers dwelling coverage, structural coverage, personal property coverage, personal liability coverage, guest/ visitor medical protection, and additional living expenses coverage. Homeowners are advised to purchase any of the available policies to protect against emergencies and huge financial expenses for repair works.
When dealing with home insurance, there are several common misconceptions. Understanding these misconceptions and the truth will help you to make informed decisions as you shop for the right coverage for your home. Here are a few common home insurance misconceptions.
- Home insurance will only protect your property and your belongings.
Home insurance does not only protect your property or belongings. It also protects guests and visitors. It provides liability coverage when someone not living on the premises sustains an injury on your property. If a guest trips and falls while using the stairs or gets hurt in the pool, you can be sued for damages. Your plan can help pay for the legal expenses and medical bills if you are found guilty.
Like every Insurance policy, there is a limit to your coverage cost, and you can increase it even further by purchasing an umbrella policy. Reach out to your agents to discuss the available options.
- A standard home insurance policy will cover all types of water damage.
Your home insurance covers several damages but doesn’t cover all types of water damage. Most providers exempt coverage for floods. It is no surprise that most plans do not include flood insurance because the natural disaster causes one of the most severe damages to properties. You must purchase additional coverage or a separate policy for flood coverage.
Not every community can provide flood coverage to homeowners, so you should ask if your community offers such before purchasing a home. When purchasing flood insurance, you should ask your provider what it covers and what it doesn’t.
- Your home insurance policy covers everything you own, including valuables.
No, your policy doesn’t cover everything you own as there are certain exceptions. There are limits to what is covered, and some types of losses are exempted. If you own jewelry made with precious stones or high-value artwork, you have to buy additional coverage for them. Your valuable collection needs extra protection for its coverage.
Also, you may only be covered for the actual cash value of your belongings, which means that you are only paid the value of the property at the time of damage. If you have old furniture that gets damaged, the compensation you are entitled to would be the depreciated value of that furniture. This means that the amount you receive for your possessions might not be enough to replace them.
- Your home insurance policy continues even when the building is vacant.
Many people believe that home insurance will cover your home even if it is vacant. Ask your provider about coverage when your property is vacant and for how long. Vacant properties are at a higher risk of theft, burglaries, and other damages. Your current policy might already cover you for losses like theft while you’re away, but it is best to check and understand all of your coverage details and limitations. Many home insurance policies will not cover a loss if your home is unoccupied or vacant for more than thirty days.
- Home insurance does not cover replacement or repair costs for natural disasters.
Most coverage policies protect homeowners from loss caused by natural disasters, including lightning, windstorm tornadoes, volcanoes, or hail. However, there are a few exceptions. Many home policies do not cover floods and earthquakes. If your property is in a flood hazard area, it is best to buy additional flood insurance to make sure that you’re covered. The same goes for areas that are prone to earthquakes.
You do not have to wait to be in a danger zone before purchasing this additional coverage because flooding can happen anywhere. If you don’t live in a flood hazard zone doesn’t mean that you are safe from danger.