What Is and Is Not Covered Under a Standard Home Insurance Policy
There is much confusion about what exactly your homeowners insurance policy covers. In June of 2007, the National Association of Insurance Commissioners (NAIC) released a startling report that revealed many homeowners’ lack of knowledge regarding their home insurance policies. For example, even in a post-Katrina era, a staggering 33 percent of homeowners incorrectly think that a standard home insurance policy covers flood damage. Even more surprising, 68 percent of homeowners think a standard home insurance policy covers vehicles damaged or stolen on their property.
Perils, from the Devastating to the Disagreeable Not Covered
A typical home insurance policy does not cover damages caused by some of nature’s most calamitous disasters, including earthquake and floods. Also not covered by a standard home insurance policy are damages caused by a break in the sewer line on one’s property, termite damage, or mold damage. In most states, a standard home insurance policy will not cover you if you are held liable for someone who drinks alcohol in your home and then gets into a car accident upon leaving your home. Similarly, pets that are lost, stolen, or injured on your property are not covered by a standard home insurance policy.
Perils Covered
Property and liability coverage within a standard home insurance policy extends beyond the boundaries of your home. If you are on vacation and suffer the loss of a valuable item, the item is covered "as long as the loss is by a covered event of peril." If you are found legally responsible for an accident that causes loss or injury to another individual, your home insurance policy will most likely cover you, even if that accident occurred nowhere near the parameters of your home. A standard home insurance policy covers personal property stolen from your home; likewise, that same home insurance policy will cover personal property stolen from your vehicle. However, check your insurance policy for any limitation and exclusions listed.
Special Circumstances
If you are in the military and deployed to Iraq, Afghanistan, or anywhere else in the world, make sure to call your insurance agent to determine if your personal items are covered if lost, damaged, or stolen. While standard home insurance policies cover personal property while traveling, most policies exclude coverage for damage or loss caused by war. If your home is damaged or destroyed by an invading army, terrorist attack, or a nuclear accident, you will most likely not be covered. If your home is damaged or destroyed as a result of riot or civil unrest, your insurer will likely cover the loss. If your ex-boyfriend sets your house on fire, you are likely covered; however, if your teenage son or estranged wife sets your house on fire, you may not be covered.
Exceptions to the Rule
Please note that every insurance company is different in its list of covered perils and items. This article is meant to be a general overview of a typical standard homeowners insurance policy; but as with anything, there are exceptions to the rule. For details regarding your own standard home insurance policy, call your insurance agent and read over the
items outlined in your policy.