All the things Homeowner’s Insurance Doesn’t Cover

You might be under the misconception that the insurance policy you took for your home will cover every single accident or mishap that comes your way. Keep on dreaming! The unfortunate truth is that no single homeowner insurance policy covers all of the mishaps and accidents that might occur at your home. Reading through the fine print for your insurance policy will confirm this. Remember, like snowflakes, no two insurance policies are exactly the same. There are subtle differences between insurance policies that will make a whole world of difference to what’s covered and what’s not.

So if you are looking to know whether your insurance will cover the damage caused by your cat when it had an emotional meltdown last week, read on. The worst thing that can happen to you is to get caught off guard when an uncovered home emergency takes place, and you don’t have the cash to get it fixed.

  1. Home renovation

Listen. If you are doing a major renovation to your house, most policies will require that you take out a separate, specific policy to cover the renovation, even though your builder might have an active risk policy.

This doesn’t apply if you are merely doing a few cosmetic upgrades to your house. But if you are looking to structurally alter portions of your home, a standard homeowner’s insurance policy will not cover the renovations. Getting a separate renovation policy for your home renovation project will also cover your liability in case people wander onto your property and get hurt.

  1. Prolonged and slow leaks

Insurance companies can deny you insurance coverage if they can prove that water damage occurred to your home because of a “slow and prolonged leakage”. Standard Homeowner insurance policies only cover water damage that occurs due to a “fast and sudden flow”.

To understand this better, an example might help. A contractor, while building a house managed to damage a pipe, that was running to a rarely used guest bathroom in the house. No one noticed the leak for a few years, and when it came time to let the house out to a tenant, the water damage had become significant and had spoilt the floorboards in the bedroom. The damage caused was in the thousands of dollars, but the claim was refused by the insurance companies. So, beware. Read the fine print!

  1. Earthquakes

Contrary to popular assumptions, damage caused to homes because of earthquakes are not covered under a standard homeowner’s insurance policy. If you reside near a known fault line that is extremely earthquake prone, then it would be wise for you to get a separate earthquake damage coverage policy that will cover any damage caused to your house and the things inside your house, in the event of an earthquake.

If you don’t have this policy and an earthquake strikes your town, destroying your house, you’ll have to pay for all of the repairs from your own pocket, which is not a great thing to have to deal with, especially in such a tragic event.

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