Your house is likely your biggest and most important asset, and it’s only right to protect it by getting home insurance.
Shopping for home property insurance takes a lot of effort and research on your part. After all, it’s a significant investment in its own right, and you would want to make sure that the policy you’ll obtain would fit your needs and budget.
Sometimes, however, the home insurance-shopping process can be derailed by myths that only serve to confuse you or worse, make you think your policy will do more than it’s supposed to just to help you out in the event of catastrophic damage or loss.
Let’s take a look at these home insurance myths, some of which have been around for some time now.
Home Insurance Covers Damage and Loss Caused by All Disasters
Some homeowners have been led to believe that once you get home insurance, any damage or loss caused by just about anything that could strike your home will be covered by your policy.
While a standard home insurance policy does provide for damage or loss caused by covered perils such as fire, windstorms, hailstorms, falling objects, vandalism, and theft, it does not protect your home against:
- Flooding (due to external causes like flash floods or burst dams)
- Damage or loss caused by negligence
- Damage or loss caused by vermin
- Wear and tear
All Your Personal Belongings Inside the House Are Fully Covered
Your clothing, appliances, furniture, sports equipment, and other belongings inside your home will indeed be paid for by your standard home insurance policy in case of damage or loss due to a covered peril.
However, priceless artwork, valuable jewelry, and designer dresses with steep price tags will only be covered up to the policy’s limits, which means your compensation for them will likely be so much smaller than their full value.
To insure your valuables at their full value, you will need to schedule them on your policy, which means they will have their own deductible and insured amount.
Your Insurance Company Will Compensate You for Anything You Claim You Lost
One of the things that insurance companies are past masters at is investigating claims. You cannot just exaggerate your losses and expect your insurance company to pay for them. They will find out the truth one way or another, and you’ll end up breaking their trust.
There’s also the fact that your insurer will ask you to submit an inventory of everything you lost. That home inventory is expected to contain specific details such as date of purchase, purchase price, photos, receipts, and serial numbers, among other things. That will make it harder for you to pad your claims.
Your Policy Will Pay if You Suffer an Injury at Home
Some people believe that the liability component of a standard home insurance policy kicks in when you or any member of your family suffers an in-home injury.
Liability coverage will pay for medical costs of a personal injury claim alright, but only for guests or third parties who got hurt while inside your property.
For accidents involving you or a family member, you will have to check your health insurance for assistance in paying for your medical costs.
Older Homes Are Cheaper to Insure
The opposite is actually the truth in this case. The older your home, the higher your home insurance rates will be.
Insurers typically view aging homes as a higher risk than new builds. Because they’ve been around for a much longer time, older homes tend to be more fragile, and some of the construction materials used on them may already be obsolete.
Older homes also have older plumbing and electrical wiring, increasing the possibility of a claim anytime soon. Some insurance companies may even refuse to cover an older home because repairing them will tend to be costly.
These are just some of the many myths about home insurance. Make it a point to ignore them, and always ask the right questions when talking to an insurance agent to ensure you have everything covered.
About the Author:
Rachael Harper is the Content Marketing Strategist of Bennett & Porter, a wealth management and insurance firm based in Scottsdale, Arizona. When not writing, she makes use of her time reading books and playing bowling with her family and friends.