Insurance Basics: Everything You Need to Know

3 Things Your Standard Homeowners Insurance Policy May Not Cover

A standard homeowner's insurance policy provides you with financial protection in a wide range of situations. However, there are some rather common types of damage that these policies often will not include. In order to ensure you are protected in these often excluded perils, you will need to purchase either a ride-on or a separate policy. That is why it is so important for you to have a clear understanding of what your homeowner's insurance policy does and does not cover. Continue reading to learn more about some of the common types of damage that your standard home insurance policy may exclude. 

#1: Flood Damage

Many homeowners simply assume that their homeowner's insurance policy will include coverage for flood damage to their home. However, while some insurance policies will provide limited coverage for water damage, standard homeowner's policies will exclude any water damage resulting from a flood. Since repairing water damage to your home can be incredibly expensive, it is important to ensure you purchase flood insurance in addition to your homeowner's policy. If you live in an area that is at high risk for flooding, you may need to purchase this additional insurance coverage through the federal government since private insurance providers often decline to provide coverage in these areas. 

#2: Earthquake Or Hurricane Damage

If you live in an area that is prone to earthquakes or hurricanes, you should know that damage resulting from these types of natural disasters is not typically covered by a standard homeowner's insurance policy. In some cases, you can add this type of coverage to your existing policy for an additional cost. However, most people will need to purchase a completely separate policy if they wish to be covered in the event of earthquake or hurricane damage to their home. 

#3: Termite Damage

Termites can easily cause a significant amount of damage to your home in a relatively short period of time. The cost of repairing this damage can be quite high. Unfortunately, many homeowners simply assume that their homeowner's insurance will cover this cost and ultimately find themselves in a financial bind when they learn that they are responsible for covering these costs on their own. The good news is that you can easily avoid finding yourself in this same situation by taking a proactive approach to the problem. This is because while most standard homeowner's insurance policies will exclude damage from termites or other insects, most insurance providers will offer this coverage at an additional cost.