How do you know what to look for in a homeowner’s insurance policy? The first thing you should do before you look for a home- owner’s policy is to sit down and determine what about your house and belongings is important to you. For example, do you have a large quantity of antiques, or oil paintings? Do you have one or two cars in your garage? What about all those photographs you have been saving forever. There are certain items that a homeowner’s insurance policy will cover and there are items it will not.
When looking for a homeowner’s policy look for a company that has a good rating by more than own insurance rating agency. Make sure you understand what a particular rating means. The different rating agencies for insurance companies have their own designations and may mean something different.
You really need to read the fine print in a homeowner’s insurance policy. There are always exceptions and exclusions. For example, remember the oil paintings I mentioned in the first paragraph, may be excluded. Many insurance companies will require you to obtain a seperate policy for collectibles due to the fact that their value is subject to many variables and proving their condition at the time a claim may be filed is usually very difficult.
Do you live in a flood plain? Many homeowner’s insurance policies do not cover flood plains. What about wind damage? Do you live an area known for high winds? Many homeowners live on a beach or near the ocean. Take Florida for example. After the hurricanes went through east-central Florida wind insurance became a seperate issue. Most homeowner’s policies no longer covered wind damage or a seperate rider was added at a signifacant increase in premuim. Make sure you know how water damage is covered. If water damage is caused by the wind blowing it in the house and not by water flooding the house because the creek that runs near the house flowed over it’s banks, than it may not be covered by your flood insurance.
Something most homeowner’s insurance policies cover, to my surprise,is hail damage. I never gave it a thought until a severe hail storm hit our home. The damage didn’t seem to bad at first glance, but when the rain continued for two days the leaks began to show up. I figured it would be considered an act of god or some other silly exclusion. Again to my suprise, not only was the roof covered. but all of the damage caused by the leaks. The insurance company paid for the new roof,repair of the walls and painting of the living room, dining room, and hallways.
Check to see if the homeowner’s policy you are considering covers plumbing and electrical wiring that may run under the foundation of the house. Some insurance companies will not insure homes that have plumbing and wiring that requires removing part of the foundation to make repairs. Some insurance companies will surprise you though. I recently had a small flood in my home. Our plumbing ran under the foundation and of course that is where the leak occured. I called in a professional plumber to fix the problem. He suggested that I check our homeowner’s policy to make sure that it would cover the possible need to tear up the foundation to repair the leak. My policy made no mention of it one way or the other. My insurance company sent out two estimators that quoted repairing the leak by taking up the foundation. My plumber suggested that instead of tearing up a bunch of concrete that we should consider going overhead through the attic. I agreed. When he was done and presented me with the bill it was under one thousand dollars. My deductible was one thousand dollars. I figured I was out of luck. My insurance company sent me a check that covered the whole bill. They explained that eventhough I had not met the deductible, since I decided to let the plumber go through the attic and saved them thousands of dollars, they felt it was only fair to remimberse me.
In conclusion, like any contract that you enter into, take the time to read the whole policy, including the fine prnt, and make sure if you do not understand any of the terms or conditions you should consult an insurance professional or an attorney.