Things To Watch Out For

Your house is more than just a home, it is what protects you and your family. With extensive coverage options and policies tailored for you, let’s see how we can protect the roof over your head.

Deductibles

Deductibles on homeowners’ insurance policies are set up differently than the traditional deductibles on auto insurance. You have all peril deductibles, and then you have wind/hail deductibles. These deductibles can be different at times when insurers split the deductibles to reduce premiums.

Splitting deductibles is a great way to make your premiums more affordable. However, be wary of insurers raising your deductibles too high for windstorms/hail to decrease the quotes/premiums for you. You may find yourself paying thousands of dollars more than your normal premium in the event of a hailstorm.

Settlement Terms

Dwelling, Roof, Personal Property, Carpets, Etc.

For the sake of ease, we will use a roof loss to explain settlement terms. The following explanations stand true for personal property, roofs, and dwellings.

Scheduled Payment/Actual Cash Value

This valuation type is common amongst insurers for roofs and depreciates your roof each year. In the event of a loss, the insurer will only pay for a percentage of the roof replacement. In other words, you will pay your deductible AND the difference in the actual roof cost and the depreciation.

Replacement Cost Value

Replacement cost does not take any depreciation into account. If the market value on a new roof is $10,000 for your home, you will pay your deductible and then the insurer will pay for the remainder of the roof replacement,

Primary Coverages

Coverage A: Dwelling

Dwelling means the building or section of the building used as the primary private residence located on the residence premises. Dwelling does not include separate structures.

Coverage B: Separate Structures

Separate structure means those structures, including buildings, on the residence premises set apart from the dwelling by clear space or structures only connected to the dwelling by a fence, sidewalk, driveway, patio, decking or utility line or similar connection; and all fences, walls not part of a building, sidewalks, walkways, driveways, pools, pool cages, piers, wharves, boat docks and spas on the residence premises, whether or not next to or connected to the dwelling.

Coverage C: Personal Property

All personal property owned by the insured

Coverage D: Loss of Use

Additional Living Expense

If covered loss or damage to the dwelling occurs making a part of the dwelling uninhabitable by the insured, the insurer will reimburse the insured for the actual, reasonable, and necessary increase in living expenses incurred by the insured. In other words, if you have to buy some new clothing, rent a home, etc. this money will be used

Loss Of Rents:

If covered loss or damage to the covered property makes that part of the residence premises rented to others or held for rental by the insured unfit to live in, the insurer will cover the actual loss of rent less any expense that does not continue during the loss period

If your residence is being rented and you lose rent due to a covered loss/peril. You will be reimbursed for the loss of income!

Coverage E: Personal Liability

Separate structure means those structures, including buildings, on the residence premises set apart from the dwelling by clear space or structures only connected to the dwelling by a fence, sidewalk, driveway, patio, decking or utility line or similar connection; and all fences, walls not part of a building, sidewalks, walkways, driveways, pools, pool cages, piers, wharves, boat docks and spas on the residence premises, whether or not next to or connected to the dwelling.

Coverage F: Medical Payments To Others

The Insured will pay reasonable medical expenses for necessary medical services furnished to a person to whom this coverage applies for treatment of the bodily injury.

  • In other words: if a guest or someone in your home gets injured and has medical bills BUT you are not liable, this coverage comes in to help with those medical expenses

Coverage E: Personal Liability

Separate structure means those structures, including buildings, on the residence premises set apart from the dwelling by clear space or structures only connected to the dwelling by a fence, sidewalk, driveway, patio, decking or utility line or similar connection; and all fences, walls not part of a building, sidewalks, walkways, driveways, pools, pool cages, piers, wharves, boat docks and spas on the residence premises, whether or not next to or connected to the dwelling.

Coverage F: Medical Payments To Others

The Insured will pay reasonable medical expenses for necessary medical services furnished to a person to whom this coverage applies for treatment of the bodily injury.

  • In other words: if a guest or someone in your home gets injured and has medical bills BUT you are not liable, this coverage comes in to help with those medical expenses

Other Coverages:

Extended Replacement Costs

This is usually considered inflation protection. If you buy a home in 2020 and it is protected for $400,000 and you experience a total loss on the property in 2022. The home could now cost more to replace as materials, labor, and other commodity prices could have increased. This is a great way to ensure you have adequate coverage for the long haul!

Guaranteed Replacement Costs

This protection is to ensure that no matter the updates on a home, inflations, increased costs, etc. your dwelling is covered. If it is worth 1 million dollars and it burns down but was only insured for $500,000 with a Guaranteed replacement cost endorsement you are covered for the full rebuild of the home.

Building Ordinance

This can be called a few different things depending on your carrier. If your home experiences a covered loss (let’s say a fire) and while the damaged portion of the home is being rebuilt they find that the rest of the home’s electrical is not up to code/ this coverage comes into play and provides funds to bring the rest of the dwelling up to code in accordance with local laws.

Limited Matching

This provides coverage to replace undamaged property for composition shingle roofs and vinyl or aluminum siding, that would not otherwise be covered, to match the replacement of damaged obsolete or discontinued property on a covered loss.

  • In other words, if only part of your roof was damaged and needed to be replaced the insurer might not want to pay to replace the whole roof. This coverage ensures that the whole roof can be replaced and paid for.

Marring/Limited Metal

Soft metals such as downspouts, gutters, and flashing are typically excluded from protection on a policy. Damage or marring to standing seam metal roofs is also excluded from the policy as well unless the roof is affecting the livability of the dwelling. This coverage removes the exclusion and provides coverage for those types of metals on a home.

Endorsements:

  • Loss Assessment

    This coverage is defined as coverage for condo/townhome owners that provide protection for situations when the owner of the shared property is held financially responsible for a portion of the costs for a covered loss to the building or shared areas of a property.

    What this means: If your condo gets hit by a bad hailstorm and the roof needs replacement. The HOA could charge each unit owner a certain amount (say $4000) to pay for a portion of the roof that exceeds their master policy limits. If you have loss assessment coverage, your insurance will pay for the loss assessment that was levied against you!

  • Incidental Coverages

    • Guns, jewelry, computers, etc.
    • This is basically an extension on limits for theft of certain items. If you have expensive guns, computers, or jewelry these are important things for your agent to know and cover.

  • Personal Injury Protection

    • This may sound like it would cover medical bills, but it doesn’t! this is for personal injury protection OTHER than medical. This includes false arrest, malicious prosecution, wrongful eviction, legal costs, etc.
    • This is more of a mental and/or psychological-based claim.

  • Sewer And Drain

    In the event of water backing up into your home from your plumbing/drains OR your sump pump failing. This endorsement provides protection for your flooring, cabinets, personal property, etc. that could be ruined by the water backing up into your home.

    This hazard is typically excluded from a policy and will only be covered with this endorsement. It does not pay to fix the sump pump or repair plumbing, only to replace damaged property.

  • Limited Water Leak

    Limited water leak coverage can also be called hidden water coverage. It protects you from losses in your home from water damage caused by slow leaks that you cannot see in your home’s internal systems. Typically, this is excluded as this is deemed a preventable loss with proper home maintenance.

    This endorsement eliminates the exclusion for limited/slow/hidden leaks and ensures your personal property and the damage that is done to your home are covered.

  • Service Line

    Service line coverage will pay to replace (up to policy limits) the electrical line, sewer line, or water line leading to or from your home in the event of a covered loss.

    What does that mean? Sewer lines are a great example. If the sewer line ruptures leading away from your property BUT is on your property YOU will have to pay to replace it. If you have this coverage however your insurer will pay to replace it (after your deductible of course)

    Let’s say a tree root grows through your sewer line and ruptures it, that’s covered!

  • Limited Mold

    Mold is a tricky one. Typically, on policies, damage from mold or when mold is found during a repair is excluded from coverage on a policy. This is usually the case because insurance companies find mold to be preventable with standard home maintenance and upkeep.

    This endorsement removes that exclusion and makes it so mold is a covered peril in your policy and can be covered in the event of a loss.

  • Plumbing Repair

    This one is a great endorsement to pair with sewer and drain coverage. The actual plumbing fixtures (pipes, drains, etc.) are excluded from coverage in the event of water backing up or a pipe rupturing. This endorsement eliminates that exclusion and ensures that in the event of a covered loss your pipes/plumbing themselves are covered.

  • Home Sharing

    Airbnb, VRBO, etc. are very popular options for homeowners these days. What a lot of homeowners don’t know is that the liability on your homeowners’ policy may not extend to cover the short-term renters. The Home Sharing endorsement assigns a separate amount of liability coverage for your short-term renters. This will ensure that if they injure themselves on your property during their stay, you are COVERED!