Understanding your homeowners’ policy and everything it contains is the best way to protect yourself from being a victim of a financial disaster. Many people who are misinformed about the extent of their insurance coverage can end up paying a lot to repair their homes.
Here are 4 common myths related to homeowners insurance that you should steer clear off to make better economic decisions related to your home:
Myth #1 All Personal Belongings are Covered
Your homeowner’s insurance policy will cover most of your belongings, but it may fall short when it comes to covering antiques, collectibles, jewelry, various works of art, and other such high-value items. Items worth more than their face value, like antiques and collectibles, usually are insured only for a fraction of their actual value. Instead of relying on the insurance company to set a value, have your items appraised, and then insure them for what they are actually worth. This ensures that you are fully compensated in case the items are ever stolen or damaged.
Myth #2 Damages Caused By Floods Are Covered
A traditional homeowners’ policy will not cover homes that are situated inside a flood plain. In such a case, you will need to purchase a flood insurance policy in addition to your homeowners’ policy.
While your homeowners’ policy does cover various types of water damage from burst/frozen pipes or even sewage back-ups; floods and their resultant damages fall in a different category and hence, must be covered by a separate policy.
Myth #3 Damages Caused By Mold and Termites Are Covered
As a homeowner, it is your responsibility to maintain your home in an excellent condition for as long as is practically possible. Inspecting your home regularly will enable you to uncover black mold and termite damage. Damages caused by mold and termites are considered to be preventable through periodic maintenance and, therefore, will not be covered by your homeowners’ insurance. Instead of relying on your insurance company to cover the repairs, be proactive, and stop the problems before they start.
Myth #4 All Rebuilding Costs Are Covered
One of the most popular myths associated with homeowners’ insurance is that it covers the entire cost of rebuilding your destroyed home.
The truth, however, is that the value of a home change over the years.
The current market value of your home may not be what it was when you purchased your policy. That means the insurance payout may fall short when it comes to covering the cost of rebuilding your home. If you are unsure of what your home’s current market value is, contact your agent to ensure that you are fully covered.
These are some common myths related to homeowners’ insurance, which may cost you beyond your coverage, leaving a gaping hole in your pocket. Hence, it is always advisable to be better informed and adequately covered to avoid any unpleasant surprises.
If you are concerned that you may not have the right amount of homeowners insurance, contact the experts at Promised Land Insurance Group. We are ready to help you with all your coverage needs.