Most homeowners know that they need some sort of insurance to protect themselves from risk, but what specific risks are these policies really protecting you against? How comprehensive are they, and what should you look out for whenever you read policy documents? Let’s find out.
Fire and smoke damage
One of the biggest ways home insurance protects property owners is by eliminating or reducing the cost of fire and smoke damage. Fires are actually more common in homes than you might imagine and usually occur in the kitchen.
The most common cause is chip pans and other forms of cooking with oil. When the oil lights up, it can be very difficult to put out, and even fire blankets may not extinguish the blaze. Home insurance, however, protects against this by reimbursing all of the costs even if the fire spreads throughout the whole home. They can also pay for smoke damage and fire damage to adjacent properties even if they’re not owned by the policyholder.
Just check that your policy has all of these stipulations. Make sure that it will reduce your liability in the event that a fire that begins in your home affects somebody else.
Wind and hail
Homeowner policies can also protect your owners against wind and hail. Storms can regularly shatter roofs and windows, but insurance policies can cover this damage. The extent of damage that can be done to roofs often reaches into tens of thousands of dollars, and for windows, it can be thousands of dollars during one of these storms.
That’s why cover is so essential for so many people, it enables them to repair these issues and put their property back to working order so that they can get on with their lives. If this doesn’t happen, it can actually destroy the value of the entire property. A damaged roof can lead to dampness that spreads throughout the entire home and even the foundations. This damage is particularly harmful for wood-based homes.
Even so, insurers will often recommend that homeowners take various precautionary measures, such as:
- Prioritizing home maintenance
- Keeping gutters clean
- Regularly inspecting their roofs
- Investing in storm-resistant materials
- Adding storm shutters
- Including garage door reinforcements
Theft and burglary
In some areas, theft and burglary are also extreme risks. Opportunist criminals will often look for high-value items that they can quickly grab and then sell for cash. Most insurance policies will reimburse the full value of the item as long as it’s listed as belonging to the homeowner on the official policy document. It’s worth checking the small print here. Some insurers will insist that high-value items over a certain threshold are included on the policy from the start. This way, they can avoid the risks of having to pay out large amounts in damages, and they can tailor policy premiums accordingly.
For example, thieves might find out that somebody has an expensive painting or grand piano on their property. These items can fetch a lot of money when sold on the black market, so insurers need to know that they are present in the household so they can adjust their premiums accordingly.
Personal liability
Personal liability is another massive issue for homeowners. What’s more, it can be much more expensive than even losing the property itself. That’s because liability claims are often uncapped to the upside. Some property owners can pay out millions of dollars in damages because somebody hurt themselves at their home.
The nice thing about personal liability for injuries is that this cover can settle things like legal field fees, bills, and penalties, even if somebody gets injured on your property. The insurer will pay out things like medical costs and compensation, so you don’t have to.
Vandalism
Insurance policies can also protect your home against vandalism. Sometimes people will deliberately attack your home or simply deface it because other homes have been defaced in the area, especially if they think you’re not there. They might throw rocks through the windows or write graffiti on your walls.
The nice thing about insurance policies is that they will usually enable you to restore your home without you bearing the full cost. They may even provide incentives for you to protect your home in the future, such as adding higher fences or barbed wire around the perimeter.
Lightning strikes
Believe it or not, lightning strikes are a relatively common cause of property damage. When lightning hits, it can create an explosive force because of the massive discharge of voltage that occurs. It can also lead to fires and electrical surges that damage equipment throughout the home, as well as roof damage.
Insurers will usually have stipulations in their policies that tell you whether they protect against this type of damage. Lightning strikes are uncommon, but just check that they are not under the “act of God” category. If they are, you may need to pay for a premium to get them moved out of this and into the regular reimbursement category.
Falling objects
If a tree is known to be dangerous and falls into a roof, insurers may have an issue with paying the claim. Therefore, homeowners are recommended to cut back any dangerous trees or remove them entirely with the help of professional arborists.
If falling branches and objects do fall on the roof, insurers will often pay out, however, especially during storms. Again though, it’s worth checking. If you’re in a location with a lot of hurricanes, you may need to take out additional cover.
Homeowners should be aware that coverage can vary by property and location. Therefore, make sure you ask your insurer about any changes that they’ve made to the standard policy that they would otherwise issue.
For example, if you tell them your location, they may adjust your policy to reflect the high risk of floods, earthquakes, or gradual wear and tear. They may also fail to cover specific items like storms if you’re in a storm-prone region, especially in parts of Florida near the coast. If you really want this cover, ask insurers whether they’re willing to accept a higher premium payment from you.
