Home Insurance
Homeowners insurance is definitely essential to have due to what it does protect. Your dwelling houses your most essential and valuable items and people. However, there are some misconceptions about homeowners or renters insurance. Many assume the coverage will reimburse for any damage incurred to the property or its contents, but this is not the case.
Homeowners insurance does have limitations, such as floods and any damage which is the direct result of year of disrepair and neglect. The most basic homeowners policy will cover 10 different catastrophic events, such as fire, lightning, windstorms, hail and explosions. It may also cover accidental damage you make to another person’s property or if someone gets injured on your property, such as from a dog bite. However, there are claim limits and the homeowner is responsible for any damages above it.
Light fixtures, bath fixtures, wiring, heating, plumbing would typically be covered under a homeowner’s policy. The policy may even reimburse you for stolen or damaged possessions, and sometimes pay for temporary alternate living cost, too. However, a homeowners insurance policy will not reimburse the cost of a stolen vehicle, nor will it reimburse you for the market replacement cost of an item, but up to the actual cash value (ACV). Insurance companies define ACV as the actual market cost of an item when first bought, less depreciation. You are always free to purchase added endorsements or riders to increase the reimbursement limit, however.
Renters Insurance
Renters insurance, on the other hand, does not cover the building property, or for structural damage, since the building is not under your ownership. Instead, renters insurance strictly covers your personal belongings and property within the dwelling. There are coverage limits and enhancements or riders are most times available for additional premium. Certain enhancements include things such as hotel stays in the cases of flooding or fire where your apartment is uninhabitable.
Renters insurance, like homeowners insurance, also covers liability so if someone gets injured in your apartment you will be covered for damages up to the coverage limit. One interesting tidbit about renters insurance is that it will not cover bed bugs or any rodent or insect infestation, actually. This is considered a home maintenance issue and should have been avoidable, therefore, not covered.
A notable caveat of homeowners and renters insurance is that although it may cover certain types of water damage from, perhaps, a burst pipe or punctured pool, it will not cover damage from flooding. Flood insurance is bought separately from homeowners insurance and is even required to be carried in certain areas that are prone to flooding.
Looking for renters insurance? Check out your options here!
Flood Insurance
Flood insurance will cover water damage to your basic building property, such as electrical and plumbing systems, furnaces, permanently installed paneling or carpet. But to be reimbursed for your contents a separate contents policy must be purchased. Contents are items such as carpets installed over a hardwood floor, clothes, furniture, electronics, washers and dryers or portable dishwashers.
Most flood insurance is underwritten by the Federal Emergency Management Association (FEMA) through The National Flood Insurance Program (NFIP) , but it cannot be purchased directly. People interested in purchasing flood insurance can obtain this type of policy through a private agent or agency, such as through Floodsmart.com. Some private underwriting insurance companies also offer flood insurance, such as Fireman’s Fund or Chubb.
Flood insurance does make a distinction to basements in a property since these oftentimes will be prone to flooding. Any cosmetic improvements made to a basement are not covered under flood insurance. Therefore, if a storm floods your finished basement anything destroyed beyond the exterior walls, concrete floors and staircase is a loss. A standard homeowners policy will not cover this damage either, since it’s flood-related. Therefore, it is recommended by insurance advisors, such as insurance.com, that those wanting to cover a finished basement purchase added endorsements or riders to their flood policies to be compensated some for a loss.
Also not covered under a building property flood policy are outdoor belongings, such as patios, decks, trees, plants, septic systems, wells, hot tubs or swimming pools. Temporary housing expenses and business revenue losses are also not reimbursable by a flood policy. Therefore, remember to ask when buying flood coverage about additional riders or endorsements to extend your flood coverage, if possible.
The cause of the flood is also important in order for it to be covered by a flood policy. For example, if a sewer backs up and floods your home but the backup is due to a rodent infestation and not a storm, it will not be covered under a flood policy.
Pet Insurance
Your homeowners insurance may offer some protections that concern pets such as liability if your dog bites someone and causes injury. Some homeowners insurance plans will even cover your pet’s accessories, doggie boots or your cat’s jeweled collar. However, a homeowners policy is protecting you, more or less, and not your canine.
Renters will need to confirm if their chosen plan covers their pet, since some will and others are very limited in scope. Also it’s important to note that in the eyes of your homeowners or renters insurance policy, your pet itself, is not viewed as an item of your personal property, and is not protected under your plan. Pets are viewed as separate beings and not property.
Pet insurance can fill in the coverage gaps where homeowners insurance leaves off. Veterinarian bills are just as expensive as your own doctor bills, so it does make sense to have an insurance plan to carry some of the burden of cost for these bills. Health maintenance for your pet can be regulated by law and so the cost for pets’ health care is inevitable.
Pet insurance of course carries a deductible and your premium will vary on the coverage limits and deductible amount chosen. Check out our link to find the pet insurance that’s right for you!
Travel Insurance
Travel insurance is something that is temporary in design and a person will obtain when taking a costly vacation since it typically covers trip cancellation, trip interruption, lost luggage or accidental death. Some travel insurance plans may even offer limited medical benefits. Travel insurance will pay for a doctor anywhere if you get injured while on vacation.
Your HMO out-of-network health insurance coverage most likely would deny your claim for coverage on that medical visit. Enhancements to your travel insurance are also available in the form of riders and will cover certain risky activities, such as scuba diving or bungee jumping. Because even the adrenaline seeker deserves peace of mind.
