Do you know what your homeowners insurance policy actually covers?

You call your insurance agent, fill out an application, pay your premiums and years go by without any problems.  So there’s no need to review your insurance policy or ask any questions, right?

Unfortunately, if the time comes when you do have to report a claim to your insurance company, before you pick up that phone, it’s important to know that your claim will be covered by your insurance policy.  If you do not have the proper insurance policy in place before your loss, there is generally nothing you can do to correct this after damage occurs to your home.

It’s all too common that we run into policyholders who have to pay out of pocket for thousands of dollars of damage because they are either under-insured or have no coverage at all under their homeowner insurance policies.  Some of the more surprising examples are insurance policies that only provide $1,000 of coverage or policies that totally exclude water damage.  There are also other insurance policies known as “named perils” policies that only provide coverage for a limited number of losses such as fire, theft, volcanoes, and others.  Under these types of policies, there is generally no coverage for water damage, plumbing failures, or hurricanes.  This can be a major problem when a policyholder realizes this for the first time after reporting their claim to their insurer.

Many times, all it takes to get your policy in check is a quick call to your insurance agent.  He or she will be able to answer your questions about what exact type of insurance policy you have and the different types of coverages afforded to you under your policy.  Some questions you should ask your agent are:

  1. What type of policy do I have (H-03, H-06, H-08, etc.)?
  2. What are my policy limits?
  3. Do I have coverage for water damage?
  4. What are the limits to additional coverages (mold, ALE, etc.)?
  5. Will my current insurance company exercise their right to repair my home in the case of a covered loss?

Ask your agent to explain how the answer to each of these questions affects the coverage afforded to you under your current insurance policy.  If you still have questions about your coverage, please contact our office and we will be happy to help.