8 areas that most home insurance companies don’t protect
Standard homeowners insurance typically excludes various types of damages, including earthquakes, flooding, sewer backup, and more. However, most insurance companies offer supplemental coverage, often known as insurance riders, to fill any gaps in coverage.
Earthquakes and earth movement
Most home insurance policies exclude coverage for earthquakes and other forms of earth movement. But you can usually purchase additional coverage for these events through an earthquake or earth movement insurance rider.
Earthquake insurance covers damage from seismic events, while earth movement insurance covers damage from a broader range of earth movements, such as landslides.
Standard homeowners insurance policies don’t cover flood damage. For example, if a storm floods your basement and seeps through to your foundation, insurance won’t cover the damages. And flood damage costs can add up quickly — the average claim payout for water damage is $11,650, according to the Insurance Information Institute.
Separate flood insurance policies may be available through your insurance company or the National Flood Insurance Program (NFIP).
Standard home insurance may provide limited protection for a home-based business, but you’ll likely want to purchase home business insurance. For example, if your homeowners policy covers business equipment in the home up to $2,500, and a house fire destroys $10,000 worth of inventory, your home insurance will only pay $2,500, minus the deductible.
Standard homeowners insurance policies exclude damage that results from neglect. Neglect happens when the failure to take reasonable care of one’s property results in damage or loss. Homeowners are responsible for maintaining their homes and preventing damages, such as repairing leaky roofs and promptly addressing signs of water damage.
Most home insurance companies exclude damage from sewer backup, as it’s considered preventable through proper maintenance. Insurers typically exclude sewer backup issues to keep premiums affordable and encourage homeowners to take preventative measures, such as regular sewer line maintenance and the installation of sump pumps.
Wear and tear
Insurance policies protect against unexpected and sudden damage, not issues caused by gradual wear and tear. Insurers expect homeowners to perform routine maintenance and upkeep to prevent wear and tear from escalating into more serious issues. For example, if you fail to address a leak in your ceiling, and it causes water damage to your floor, your insurance wouldn’t cover the damage.
Insurance companies consider termite damage avoidable through routine maintenance, such as regular inspections and termite treatment. It’s not considered sudden and accidental damage and so is typically excluded from standard homeowners coverage.
Valuable artwork and jewelry
Your homeowners policy may include coverage for artwork, jewelry, and other valuables up to the coverage limits. But if you want to protect your high-value items thoroughly, review your policy limits and consider purchasing additional coverage to ensure you can replace them if they’re stolen or damaged.
Learn More: What Does Home Insurance Cover and What Does It Exclude?