Common Home Insurance Myths
Myth: Personal Belonging are All Covered
Your home insurance policy does cover your personal possessions, but only to a certain dollar amount. The amount for which you are covered depends on your policy and your personal choices, but it’s imperative you ask your agent how much personal property is covered. If you own personal property worth a substantial amount of money, you’ll want to insure it further. A good example of this is a family heirloom such as an expensive, valuable diamond ring or rare painting. These individual items could be worth hundreds of thousands of dollars more than your home, and your insurance won’t cover the costs of those items if you’re not properly insured for those.
It’s a wise idea to make a list of all your most valuable possessions, keep paperwork regarding their worth, and keep any receipts you have for the items. Photograph each one, and keep this information somewhere safe and easily accessible. If anything is lost or stolen, you can report it to your insurance agency to cover the cost of replacing each item.
Myth: Home Insurance is Expensive
It’s true that insuring your home isn’t inexpensive, but it’s not nearly as expensive as many people assume. There are numerous discounts available for homeowners who take the time to look for and apply them to their policies. For example, a home with an alarm system is eligible for a discount on the cost of coverage. A home with a fire hydrant outside the fence is also eligible for a discount. If you live near a police station or fire department, your insurance company might offer you a discount since your home is considered safer than others, which is usually less expensive to insure.
Myth: All Medical Expenses are Covered Under Home Insurance Policies
Truthfully, only the injuries sustained by others who are visiting your home are covered under your policy. If you or someone who lives in your home is injured on your property, your homeowner’s insurance will not cover the cost of those medical expenses. Your own personal health insurance policy must be used to cover the costs of your injuries.
Myth: All Claims Raise Prices
It’s true making many claims on your home insurance policy results in raised rates, but not every claim does this. If you make one claim, your rates are fine. If you make several in a short period of time, your homeowner’s insurance policy premium will rise to cover the cost of the payouts your insurance company provides. The best way to avoid this is to estimate the cost of damage caused to your home each time there is damage. If it’s less than or not much more than the cost of your insurance deductible, the best idea is to pay for the repairs out of your pocket to avoid making a claim.
Myth: Flood Damage is Covered
Home insurance policies don’t cover flood insurance. Even if you live in a flood zone, you aren’t covered by your homeowner’s insurance policy if a flood occurs. Flood insurance is a separate policy, typically called a rider, that must be added to your home insurance policy for flood protection.
Myth: All Flood Insurance is the Same
Factually, not all flood insurance is the same. Any homeowner can add a flood insurance policy to their main policy and assume it covers any form of water damage and be sadly mistaken. Flood insurance due to a natural disaster is covered under certain policies, but flood damage caused by a leaking pipe or faulty plumbing might not be covered under the same policy. Your job is to find out which policies cover which types of floods, and determine which type of flood insurance you require for your home.
Home insurance covers many things, but not often everything in one neatly tied package. It requires finding specific riders to your policy, adding value to items that are valued above the usual, and it requires doing ample research to ensure you are fully insured. Finding the right homeowner’s insurance policy is not a job meant to take place in a few moment’s time. It’s meant to take time so homeowners are able to find the right coverage to protect their home and family. No one ever expects the worst to happen to them, but it happens all the time to the most unsuspecting people. Don’t find yourself unprepared or uneducated regarding your insurance.