5 Common Misconceptions about Home Insurance

With so much information about homeowners insurance floating around the internet, it’s easy to jumble it all up. But it’s important to know exactly what you’re buying before signing on the dotted line. This article discusses five of the most common misconceptions about homeowners insurance that people frequently mix up. 

1. Filing a claim increases premium prices: While it’s true that filing multiple claims is likely to increase your premium, filing a single claim may not cause a price hike. This is particularly true if you haven’t filed a claim within the last few years. However, to protect your bank account, double check the repair estimate to ensure that the cost exceeds that of your deductible. If it’s lower, it’s more reasonable to simply pay out of pocket than to file a claim. 
   
2. Homeowners insurance covers all valuables: Certain valuables—such as jewelry, furs, silverware, firearms, fine artwork etc.—have coverage limitations. Always ask your independent agent about these details. If your valued items are worth more than a standard policy will cover, you can purchase extra coverage in the form of policy endorsements or contents coverage.
   
3. Homeowners insurance covers flood damage: Flood coverage is excluded from most standard homeowners policies. If you live near the coast or in an area prone to floods, you’ll need to purchase a separate flood policy in addition to your homeowners policy. Remember, flood insurance has a 30-day waiting period, so do not wait to buy it in the days before a flood is predicted. 
   
4. Homeowners insurance covers personal medical expenses: While home insurance covers the medical expenses of guests who are injured on your property because of liability responsibilities, it does not cover your own personal medical expenses. That’s what health insurance is for. 
   
5. Homeowners insurance covers mold damage: You are responsible for the upkeep of your house. If something needs repair work, that’s on you. The same goes with mold damage, particularly if it occurs due to neglected maintenance such as a leaky pipe. However, if mold becomes a problem after a flood, your flood insurance can cover the damages.