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When You Need More Than Homeowners Insurance

By Compuquotes Team on March 27th, 2008

Homeowners Insurance

If you're paying on a Homeowners insurance policy that your bank has accepted, then you've got enough coverage for your needs, right? You may be right - but chances are that if you assume you have enough insurance coverage, you're very wrong. The mortgage company or bank is only concerned that you'll get enough from your insurance company to pay off the mortgage if something happens to your home. The last thing you want to learn when disaster strikes is that your home insurance coverage isn't enough to rebuild or repair your home - or worse, that you're not covered for the damage at all. With the list of exclusions to homeowners' insurance growing almost daily, home owners need to sit down with their insurance policy and take a serious look at what coverage they have - and more importantly, what coverage they don't have.

Below are some typical exclusions to standard life insurance policies. Take a close look at your policy, assess the risk factors for your property, and then call your home insurance agent to find out what coverage you have and which you need to be sure that your home is insured for the most likely risks you face.

Natural Disasters

Many Southerners learned to their dismay that their homeowners' insurance did not cover damage from hurricane. Don't assume that your home is covered in case of fire, flood or other natural disaster. Read the fine print to be sure exactly which natural disasters are covered and which are not. In most cases, floods are not covered. You'll need separate flood insurance from FEMA. If you live in the forest or far from a fire station, you may not be covered for fires. In general, the higher your risk of a natural disaster, the less likely it is that your standard homeowners insurance will cover it. Talk to your agent about special riders of disaster insurance policies.

Luxury Items

In most cases, the entire contents of your home is covered under your homeowners' insurance, but if you own luxury items like expensive jewelry or collectibles like coins, you may be limited in the amount you can collect. Talk to your agent about riders to cover expensive jewelry, watches, furs, guns and other high-ticket items.

Acts of War or Terrorism

Before the World Trade Center disaster, few insurance companies excluded acts of terrorism from their insurance coverage, but it's becoming more and more common. If your home is damaged or destroyed in an act of war or terrorism, you may be on your own.

Computer and Technical Equipment

If you have more than one computer or if you use your computers for business purposes, the equipment may not be covered under your homeowners policy. Even if it is, you may be limited to recovering only what the equipment is worth now, not the cost of replacing it. If you depend on your computers for business, or if you own more than $2,500 worth of computer equipment, it may be worth insuring it on a separate rider.

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