Home Insurance Articles
What To Consider When Looking At Add On Home Insurance Coverages
2010-03-24
Homeowners often assume that because they have purchased a home insurance policy, their home and its contents are protected from any unfortunate event that may occur. In truth, however, this is not the case. Most home insurance coverage is intended to protect the structure of the home itself, as well as replacing parts of the home that become damaged, such as windows or water pipes. Basic home insurance policies, or what are known as HO-1 in many states, cover only the home itself, not the contents. In these policies, what are called "known perils" is spelled out, and the coverage only extends to what is listed. Put simply, if it is not on the list, your insurance provider won't pay for it.
In almost all states, the most common type of home insurance quotes given out are for HO-3 policies, or "broad coverage." In this case, the policy will carry a list of exclusions, instead of what is included. Broad insurance policies will cover stolen property as well as minor environmental hazards, but the list of what is excluded is still quite substantial. Insurance companies will often offer clients the option to purchase add-on coverage which is intended to cover a specific item or event, and some of these can be extremely beneficial. Two which apply to the objects inside a home are jewelry coverage and identity theft coverage. Jewelry coverage is just that - it covers valuable items in the home. While a broad plan will cover items such as televisions, stereos and computer equipment, extremely costly items such as jewelry are often left out or above the maximum about of coverage. Identity theft coverage can protect you if your wallet, bank cards, and personal documents are stolen and purchases are then made in your name. A typical insurance plan will not cover your losses in this case, and while your banking institution should, there is no guarantee.
Two coverage types for outside the home that are good to have, are earthquake and flood coverage if you live in areas affected by these disasters. Earthquake insurance is never standard on a policy, but may be obtainable either through a state-sponsored agency or your insurance provider. Flood insurance is almost never offered through private insurance companies, but the National Flood Insurance Program (NFIP), offers coverage to homeowners living in high-risk flood areas.
All of this extra coverage will mean higher monthly premiums for homeowners, or even an additional policy, in the case of flood insurance. However, these add-ons can easily pay for themselves should they ever be used. These are only a small sample of the add-ons offered by most insurance companies. Speak to your provider to see what best suits your home.