Acts of Nature: What Most Homeowner Insurance Policies Don’t Cover and How to Protect Yourself
Your Home Might Not Be as Protected as You Think
Home insurance can be a complex thing. Many homeowners, especially first-time owners, think that just because they have home insurance, their homes are protected should they ever become damaged. Sadly, in many ways, this isn’t actually the case. All too often, a homeowner doesn’t find out what their policy covers and doesn’t cover until it’s too late.
Natural disasters are among the most common exclusions from home insurance policies. These are often considered “acts of God,” and most insurance companies won’t cover damage caused by them. Here are some surprising things your homeowner’s insurance policy might not cover, and what you can do to protect yourself.
If you live in an area that’s prone to earthquakes, then your insurance policy may already cover you. But, if you live in an area where earthquakes are not as common, then you will probably need to purchase supplemental earthquake coverage because your insurance company most likely won’t provide it. The good thing is that in these areas, earthquake coverage tends to be inexpensive because the risk is low.
Other types of land movement, like sinkholes and landslides, are also not covered by most policies, however, sinkhole coverage is required to be offered by insurance companies in Florida and Tennessee. If you want to protect your home from landslides and other forms of land movement, then you should inquire about “difference in conditions” policies.
Insurance companies look at flooding as two different types of events. There is flooding caused by heavy rains and coastal surges, and then there is flooding caused by plumbing issues. Floods caused by faulty plumbing are usually covered by most insurance policies. But damage associated with floods caused by natural causes, like rain, are not usually covered.
Depending on where you live, you may need to purchase a special flood protection policy before you can even buy your home. In areas prone to flooding, these policies can be obtained through private insurance backed by the US government.
While most insurance policies don’t refer to volcanic eruptions, most do provide coverage for the type of damage that’s caused by them. The average homeowner’s policy covers things like ash and dust, particle matter, and even lava flow, as well as the cost of removing them. But, if you live in an area where actual volcanoes exist, like parts of Washington or Hawaii, then you may still need to buy supplemental coverage to ensure you have enough protection should a volcano erupt.
Hurricanes and Tornadoes
Most homeowner’s insurance policies cover wind-related damage. So, if your home is damaged by a hurricane or tornado, then the wind-related damage will be covered. But, if the hurricane causes water damage to your home, then you’re out of luck because these policies don’t typically cover natural causes of flooding. Interestingly, if your home is damaged by rain that comes through a tornado-damaged hole in the roof, then that type of water damage is often covered.
If you reside in a part of the country where hurricanes or tornadoes are possibilities, then you may need to purchase additional flood insurance to ensure your home is better protected. If you live near the water, then you may need additional beach and windstorm coverage, too.
Know Your Insurance Coverage and the Risks Involved
It pays to read your insurance policy front to back, including all of the fine print. Remember: insurance companies are in the business of making money. They don’t like paying money out, so the more you know, the better off you will be. If your coverage doesn’t protect you against certain natural disasters common in your state, then get the supplemental coverage you need now, so you will have it should you need it.