Home Insurance Myths Debunked!
Purchasing a home is probably one of the greatest joys there is. Finding home insurance is usually one of the first tasks on your lengthy to-do list. Your house is of great value, so protecting it, along with your possessions, should be a top priority.
As with any insurance policy, the hope is that you’ll never need to make a claim. With this mindset, many misconceptions about home insurance have ensued. Educating yourself on home insurance before you make a final decision is always a good idea.
To get started, let’s examine and debunk some of the most common and problematic home insurance myths.
Myth #1: The coverage limit on your policy should match your home’s value
It seems understandable that homeowners would want to look at the market value of their home to determine how much home insurance coverage to have. However, this only one aspect of what the policy is for. Sure, you want to be able to recover from an unexpected event, but the cost to rebuild your home is not necessarily equal to the value of the home. It may cost more to rebuild from scratch because your home was built with older materials, or the value of certain features in your home has decreased over time. Either way, the amount of coverage needed should be based on the cost to rebuild your home, independent of your property value.
Myth #2: Your insurance policy covers valuable possessions in your home
This home insurance myth is a dangerous one because those who fall prey to it could find themselves ill-prepared and troubled when they try to file a claim. An accident resulting in damage or loss could be met with limitations on the coverage of valuable items. For this reason, you should check to see what property is covered by your home insurance, adding supplemental coverage for valuable articles if necessary.
Myth #3: Businesses run out of the home are covered
If you’re running a business from your home, it’s common to think the business assets would be included as property under your home insurance policy. However, most standard home insurance policies will spell out that businesses and business-related property must be covered under a separately purchased plan.
Myth #4: My home insurance policy includes flood insurance by default
This is another dangerous home insurance myth, as standard home insurance will cover water damage but that’s separate from flooding. Plumbing issues and associated water damage is considered ‘water damage’ and is included in home insurance policies. Floods are the naturally occurring swells of water from storms or overflowing bodies of water which require a supplemental policy. Knowing the difference is important.
To find out more information about home insurance, contact Schechner Lifson today! Discover how we can make sense of the world of insurance, providing you with the best and most affordable coverage possible!
On the lookout for other insurance myths? See these articles on Disability Income Insurance Myths and The Red Car Myth.