Home Insurance 102: Additional Home Insurance Coverages.

Additional Home Insurance Coverages.

When it comes to protecting your home, having a comprehensive insurance policy is essential. However, did you know that there are optional add-ons you can include to enhance your coverage? These add-ons provide extra layers of protection and peace of mind, making sure you’re prepared for a variety of unexpected situations.

In this post, we’ll look at the optional coverages you have the opportunity to add to your home or tenant insurance policy to provide extra protection. Whether it’s protection from water damages, making sure your home business is covered, counting for your collectables, or more – our team can help you find every coverage you need for your lifestyle.

Water Protection Coverage.

The most common types of water protection on home insurance policies are sewer-back up and overland water.

Sewer back-up coverage provides protection for “loss or damage caused by the sudden and accidental backing up or escape of water or sewage from a sewer, sump pump or septic system.” Having this coverage helps cover the cost of repair and restoration in the above scenarios.

Overland Water coverage provides protection for “damages cause by water that accumulates upon or submerges land which is usually dry resulting from the unusual and rapid accumulation or run off of surface waters from any source, including torrential rainfall, or the rising or, breaking out or the overflow of any body of fresh water.”

Basically, these are big words that mean having overland water and sewer back up coverage provides you with money to repair your home if it is damaged by the sudden and accidental back up of sewers, toilets, drains etc. as well as sudden fresh water accumulation. Always check your policy wordings – as some policies have exclusions or exceptions to these coverages.

Home Business Coverage.

If you operate a business from your home, a separate business insurance policy may be needed. However, some insurers offer home business coverage add-ons that can provide limited coverage for certain business-related equipment, inventory, and liability. These coverages became especially popular when work-from-home jobs started popping up during the COVID-19 pandemic. Often, businesses that are run out of a home but do not have clients or customers coming onto the site are accepted. Make sure to always let your insurance broker know if you are operating or working for any business in your home.

Identity Theft Coverage.

With the rise of technology, identity theft has become a huge issue. With identity theft coverage, you’ll have help if your personal information is compromised. This coverage can help with legal expenses, credit monitoring, and identity restoration, offering valuable support and protection. Be sure to check with your broker to see if your insurance already includes this coverage, as many companies are offering this important protection as a part of their regular comprehensive policies!

Replacement Cost Coverage. (Building and/or Contents)

Home insurance policies often provide coverage for home structures and personal belongings based on their actual cash value (ACV). However, adding  replacement cost coverage ensures that your home and belongings will be replaced at their current value, without factoring in depreciation. This means that even if inflation has sky-rocketed the price of building or your belongings, your insurance policy will replace them even if the total amount to do so goes above your policy limit. Even if you do have replacement cost coverage on your policy, high value items are still best to be added separately.

Single Limit Coverage.

Each homeowner or tenant policy contains a certain dollar amount limit for various coverages (Dwelling, Additional Structures, Contents, & Additional Living). With a single limit, you can combine and borrow from each of these limits. For example, if the loss to your home ends up costing more than your dwelling limit, but you don’t have any outbuildings to replace/repair, you can use money from the additional structures limit to continue repairing your home. Or, if you lose all your contents, but your home is fine, you could borrow from your dwelling limit to replace your contents if needed.

Service Line Coverage.

Many homeowners who live in cities or municipalities are on public water and sewage systems. While there are coverages in place to protect the contents inside your home, what happens if the pipes carrying that water and sewage burst or fail under your property? Many people think that because these are municipal pipe systems, they are the municipality’s problem – this isn’t completely true. From the road to your home, you may be responsible for the pipe and any damage. Service line coverage can provide protection in case something happens to these underground pipes – it may even cover costs to fix up your yard after the pipe systems are fixed.

While home insurance policies provide a solid foundation of protection, optional add-ons allow you to customize your coverage based on your unique circumstances and needs. Adding these optional home insurance add-ons can give you extra peace of mind, knowing that you’re properly protected against a wide range of risks. The availability and range of these coverages vary by carrier – so always consult with your insurance broker to discuss which add-ons are suitable for your home and lifestyle. Don’t wing it – make sure you have the right coverages for you!

If you have questions about your home coverages or what exclusions may apply to your policy, reach out to our flock to help at [email protected].