What Homeowners Insurance Doesn’t Cover Can Hurt You

Tornadoes, hurricanes, heavy rains and other summer weather systems can cause homeowners to feel overwhelmed. Many of them rely on their homeowners insurance policies to cover nearly any kind of damage to their property. However, most homeowners insurance contain “fine print” that excludes many types of damage. A recent report in U.S. News and World Report examined these exclusions, as well as how homeowners can protect themselves when their policies fail to do so.

Homeowners Insurance Does NOT Include Flood Coverage

Thousands of homeowners insurance policy holders live in areas that are prone to flooding. Coastal communities, riverfront homes and lakeside properties are not the only places where high waters can cause damage. For property owners in flood-prone areas, the standard homeowners insurance policy does not offer flood coverage. Instead, homeowners in these areas must purchase policies through the federally-operated National Flood Insurance Program. Most mortgage brokers require that buyers who purchase homes in areas with a history of flooding purchase additional flood insurance as a condition of the mortgage loan.

Homeowners Insurance Does NOT Include Earthquake Coverage

Property owners in California understand that a standard homeowners insurance policy does not cover earthquake damage. Homeowners in other states, especially those states without a previous history of earthquakes, may assume that their homeowners insurance coverage would include earthquake protection. Residents of these states may need to check their policies or purchase additional coverage. Recent scientific studies have shown that states with heavy fracking activity are also experiencing more frequent and more powerful earthquakes than at any time in their history.

Homeowners Insurance Does NOT Provide Financial or Emotional Support

The process of dealing with property damage can create a strain on the owner, both emotionally and financially. While the homeowner struggles to recover from these blows, their homeowners insurance policies do not provide them with compensation for those losses. Homeowners who suffer from post-traumatic stress disorder due to a devastating loss must pay their own way for their treatment. Homeowners insurance policies also do not cover lost wages due to losses or appointments with contractors, adjusters or other insurance company staffers.

Homeowners Insurance Does NOT Cover a Total Rebuild

The worst case scenario, from a property standpoint, is a total loss. Whether the loss comes from a devastating fire or a powerful flood, the property owner will often find out too late that the homeowners insurance policy has a maximum claim value. In most cases, that maximum payout will not allow the property owner to achieve a full recovery. Policy holders should examine their homeowners insurance coverage to determine if they have enough protection to recover from a total loss.

Source: US News and World Report

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