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Personal Insurance

What Is Not Covered by Home Insurance?

Home insurance provides you with valuable financial protection, but it doesn’t cover everything. The good news is that you can usually fill in those gaps by purchasing additional coverage.

Here are a few of the exclusions you may see in your policy, along with what you can do to increase your protection.

1. Mold and Rot

Most home insurance won’t cover damage from mold and rot because these issues generally stem from poor home maintenance.

There are some exceptions. For example, if mold or mildew develops because of a burst pipe, your insurance may cover the cost of remediation.  In general, though, your safest bet is to prevent mold growth by controlling dampness and humidity in your home.

2. Flood and Earthquake Damage

Floods and earthquakes are both standard exclusions under most homeowners’ insurance policies. You can get flood insurance and earthquake insurance through participating insurers, and it’s a good idea to consider these policies even if you don’t live in a high-risk area.

Earthquakes can cause significant damage even if you’re far away from fault lines, and increases in severe weather events mean that any home is at risk for flood damage. In fact, the Insurance Information Institute (III) reports that 20% of all flood claims are filed for homes in low to moderate-risk areas.

3. Sewer Backups

The standard home insurance policy won’t cover damage from sewer backups.  Neither will flood insurance. That’s partly because homeowners are legally responsible for maintaining their own sanitary sewer lateral — the pipeline between your home and the municipal sewer main in the street. Even if a sewer backup happens because of a problem in the main, you’re still responsible for the damage.

The Civil Engineering Research Foundation calculates that the number of sewer backups is increasing at a rate of about 3% per year. It is worth looking into separate coverage which can be purchased or added as an endorsement to your home policy.

4. Termites and Other Pests

Pests are another issue that insurers consider to be preventable, so most home insurance won’t cover damage from infestations. This includes:

  • Rodent-chewed wiring and drywall
  • Bed bug removal
  • Termite damage

Termites alone cause more than $5 billion in property damage every year. The best way to prevent an expensive removal process is to keep your home in good repair. Fix leaks and holes as soon as you spot them, control humidity, and have a professional pest removal service check your home every year for signs of infestation.

5. Luxury Items

According to the III, because valuable items like jewelry and collectibles are easily stolen, most policies put a dollar value limit on coverage. You can increase your protection by raising the liability levels on individual pieces or by purchasing a stand-alone floater policy.

There may also be a coverage limit for cash that you keep in your home. Take your nest egg out from under your mattress and get it into an FDIC-certified account since you’ll have little recourse if it’s stolen or damaged in a flood or fire.

A Final Word

These are several of the most common things that home insurance won’t cover, but the list isn’t exhaustive.

To discuss what your policy excludes and what you can do to keep your belongings safe, contact RMC today to speak with a licensed agent.

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