Consumer Alert: Do you know what's not covered by your homeowner - Tucson News Now

Consumer Alert: Do you know what's not covered by your homeowner's insurance policy

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The more you know about what is not covered by your homeowner's policy, the better prepared you will be.

Most homeowner's insurance policies cover your damage resulting from all major perils. Exceptions many people may be aware include flood, earthquake, war, and nuclear accident. But did you know there may be other exclusions? This article discusses what's covered and what's not covered in a standard homeowner's policy.

What Is Covered

Homeowner's insurance protects you from loss resulting from damage caused by certain perils, or disasters. A total of 17 perils are defined and used by the insurance industry when writing policies. The 17 perils are broken into two groups, depending upon the policy you hold.

Group 1 - 11 Perils

Group 2 - 6 Perils

fire or lightning

objects falling from the sky

windstorm or hail

weight of ice, snow or sleet

explosions

accidental discharge or overflow of water from your plumbing system

riot or civil commotion

freezing of plumbing

aircraft

sudden and accidental damage to your water heating system

vehicles

damage from an electrical surge

sudden or accidental damage from smoke

 

vandalism (sometimes called malicious mischief)

 

theft

 

volcanic eruption

 

damage caused by glass or safety-glazing material that is part of a building

 

At a minimum, most policies cover damage resulting from this list of perils. For more information on homeowner's insurance, see The Perils of Homeownership in our Knowledge Center Library.

What Is Not Covered

While you certainly want to know the things that will be covered by your insurance policy, you also will want to fully understand the specifics that are not covered by your policy. Your policy will include a list of the things that are not covered, also known as exclusions. The lists provided in this article are not intended to fully represent every possible insurance company and coverage. Take time to review your policy with your insurance agent and, if necessary, adjust your insurance to maximize you coverage and minimize your exposure to loss.

In the standard homeowner's policy, covering all 17 perils (typically referred to as an HO-3 type policy), these are the standard exclusions you will find:

  • Floods (this insurance must be purchased separately). For more information about flood insurance, see the U.S. Federal Emergency Management Agency (FEMA) web site www.floodsmart.gov.
  • Earthquakes (this insurance must be purchased separately).
  • Damage from war.
  • Damage from a nuclear accident.
  • The land under your house.
  • Pollution.
  • Intentional damage (caused by the homeowner).
  • Structures used for a business (this insurance must be purchased separately).
  • Wear and tear on a home, including deterioration, insect and rodent infestation, settling, cracking, bulging, or expansion of pavement, walls or foundations, or damage from domestic animals.
  • Defective construction.
  • Cars, trucks, vans, motorcycles, aircraft, and boats with anything more than a small motor parked on your property (these items should be covered under separate policies for automobile, boat, etc.).
  • Loss due to power failure.
  • Theft from a house under construction.
  • Freezing of pipes in an unoccupied, vacant or under-construction house.
  • Vandalism and malicious mischief, if the house has been vacant for more than 30 days.
  • Freezing, thawing, pressure or weight of water or ice to a fence, pavement, patio, swimming pool or dock.
  • Property belonging to tenants.
  • Pets and other animals, birds, and fish residing on the property.
  • Losses resulting from the failure to protect property after a loss.

Even though your policy may not cover you for the exclusions listed, you might be covered for losses that result from the excluded event. Here's an example: The design of your fireplace is defective and flames blow out of your fireplace into the room. You are not covered for the defective fireplace, but you are covered for the fire that damages your carpet or furniture.

You can adjust your insurance coverage provided by your policy at any time. If there are exclusions you are not comfortable with, you can inquire about purchasing additional coverage. An annual checkup for your homeowner's policy will keep your coverage in the best shape to cover your insurance needs.

SIG Insurance Professionals

A blog written by experts about any and all insurance topics.

6 Common Items Not Covered By Most Homeowners Insurance Policies

So you're shopping for homeowners insurance; you found a great policy at a great price and your agent assures you that the policy is "all risk". Nothing to worry about, right?

Not necessarily.

While most of us don't spend our leisure time reading the 40-50 page policies that we receive in the mail from our insurance company, that is exactly what we should be doing!

Think that your "all risk" or "open peril" policy has you covered against any type of loss? The answer may surprise you.

Nearly all insurance companies cover the major stuff: fire, theft, lightning, and wind or tornado. It used to be that these named peril policies covered catastrophe type items only; however, most insurance companies are now opening up their policy coverage considerably.

For an additional premium, you can now purchase "all risk dwelling" (insurance term is HO-3), or "all risk dwelling/contents" (insurance term is HO-5) rather than the less comprehensive "named peril" type policy. Typically, even the broader type policy, which do afford all risk coverage UNLESS certain losses are specifically excluded, are still the way to go , but what are these common types of "exclusions"?

Flood

If you live next to a creek (even if it's empty), lake, or large body of water, I STRONGLY suggest you consider purchasing flood insurance. Your homeowner policy does not cover loss from "rising surface" water occurring outside your home AT ALL. PERIOD.

Your insurance agent should be able to tell you if you live in a flood plain (area at high risk for flood). If you are buying a new home, find out if that home is in a flood plain. If the new home is in a flood plain, you will be required to purchase flood insurance available through FEMA for several hundred dollars a month. If you don't live in a flood plane, a policy can be reasonably priced (note that the maximum is $250k for your home and $100k for your contents through FEMA) to protect you of any "just in case" flood accidents like flash flooding.

Termites/Rodents/Vermin

Does your homeowners insurance cover loss from damage caused by termites? The answer is NO. The same goes for damage done by rats, squirrels, or other rodents. Insurance companies see these types of things as the homeowners' responsibility to maintain, and don't cover them in most cases.

Your Pets

While most homeowners insurance companies will provide liability protection for you if your dog bites another person and they were to sue you, they will not cover you if Fido decides to chew up the couch, chair, rug, ect. Your homeowners insurance will not pay for you to have these items replaced.

Foundation Settling/Cracks

If you've done your homework then you may have a "dwelling foundation" rider on your policy. This covers the foundation, right? Actually, an endorsement of this type covers water damage under your slab resulting from a pipe that has broken (note that the pipe itself is not covered). But what if you notice a large crack in the slab, bricks outside, or inside the home? The answer is that this is not covered by your homeowners insurance, as "settling, cracking, earth movement, or shift" is a homeowner policy exclusion.

Power Surge

Homeowners insurance covers losses for things like fire, lightening, and wind, but what about that sudden surge of power that fries the $5,000 TV that you just bought? In most cases, power surge is an exclusion on your policy UNLESS lightning caused it to occur.

If a power spike in your neighborhood causes damage to those expensive appliances or electronics, you may find that you don't have the coverage that you thought you did to replace them.

General Wear/Tear or Manufacturers Defects

What happens if the AC unit goes out? Refrigerator stops working? How about if you notice things in the home that are wearing out or breaking before they should be, such as cracks in tile, bowed wood flooring, or damage from the home "settling in?" Does your homeowners insurance cover this? Just like with the termite example above, insurance companies look at this as "general wear & tear."

So what do you do?

Talk to your agent. Buy an HO-3 (all risk dwelling), HO-5 (all risk dwelling & contents), or HO-B (broad coverage form) policy. If your insurance company doesn't offer a policy of this type, don't worry; there are plenty of companies out there that do.

What surprises most people is that you don't pay that much more for a broader policy with better coverage and you'll have peace of mind.

Secondly, consider a home warranty. Most major appliances like refrigerators, dishwashers, and other items can be covered under a home warranty. While there is additional cost, it's certainly less than the cost to replace a major appliance. Also, if you home is fairly new, check with the builder on the warranty items in place for major items like the foundation.

Got pests? Utilize a pest control service at the first sign of a problem. A little maintenance goes a long way.

Buying a home? Look at getting a home inspection done. The $200-400 dollar inspection could save you tens of thousands later down the road. Wouldn't it be nice to know that the house you're buying already has foundation problems? It might change your mind or allow you to negotiate a considerable amount of the price of the home.

Lastly, read your homeowners insurance policy and learn what your coverage's are. If you notice something that you think should be covered, ask your agent if it can be added by endorsement.

Knowledge is power, and a little homework on your end can save you big bucks down the road!!

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