Understanding Exclusions in Your Homeowners Policy
Your home is most likely your biggest investment, and your homeowner’s insurance policy exists to protect it. But what, exactly, does your insurance policy protect, and under what circumstances? Many homeowners believe their property is covered in any or all instances, only to find out after an accident or disaster that the damage is not covered or is excluded from their policy. As a result of these exclusions, the homeowner is forced to pay for some or all of the repairs to the property themselves.
Unfortunately, in most cases, your homeowner’s policy does not protect all of your property. Below are a few examples of property that may not be covered in a standard HO-3 (homeowner’s policy):
Screened sunrooms (Florida or Lanai rooms)
Backyard tiki huts
Dock and boat lifts
These, of course, are often the first areas that get damaged when a storm comes through. Even more confusing is the language around these exclusions in your policy. It will read something like the following.
We do not cover:
1. Any structure enclosed by screens on more than one side, constructed to be open to the weather, and not constructed of and covered by the same or substantially the same materials as that of the primary dwelling; Carports, open sided porches that have a roof covering, and patios that have a roof covering not constructed of and covered by the same or substantially the same materials as that of the primary dwelling; Awnings, aluminum carports, and aluminum-framed screened enclosures; Slat houses, chickees, tiki huts, gazebos, cabanas, canopies, pergolas, or similar structures, constructed to be open to the weather.
That’s just one exclusion that may be included on the average homeowner’s policy. There are usually many more. It’s no wonder that homeowners don’t read through every word of their policies.
Exclusions are part of every home insurance policy. There are some events, causes, and disasters that are simply not covered, and there are others that require additional or separate coverage.
To simplify things for you, we’ve pulled together a list of the most common property insurance exclusions that may exist in your home insurance policy.
Ordinance or Law Exclusions
Any Ordinance or Law Requiring the Regulation of Construction: The expense required to improve your house or property to current building codes is not necessarily covered in your homeowner’s policy.
Typically, a homeowner must purchase Ordinance or Law coverage as an add-on coverage to their homeowner’s policy. This additional coverage will also require you to pay an additional premium. Most commonly the policy will add 25% of your coverage to your account for any repairs above your policy limits that are needed to meet current code requirements. However, not adding this coverage can cost a homeowner thousands in out-of-pocket expenses down the road.
Natural Disaster Homeowners Policy Exclusions
Earthquakes, Sinkholes, and Movement of the Earth: Damages from earthquakes, sinkholes, mudflow, shockwaves, and landslides are not covered by home insurance policies. Those living in states where these natural disasters are common can sometimes get a separate policy to protect them in such instances.
It is especially important for people in Florida to understand that most insurance policies today do not provide any significant coverage for sinkhole loss. The added endorsement for sinkhole coverage will either be the catastrophic sinkhole coverage or the structural damage coverage.
The traditional coverage for direct physical damage caused by sinkhole loss has been, for the most part, completely removed from property insurance policies in Florida due the amendment to Florida’s sinkhole law in 2011. For more information on sinkhole loss please contact our office for a free consultation.
Floods and other Water Damage: Insurance policies will cover certain types of water damage, but floods caused by nature, such as an overflowing river or flooding cause by a hurricane, are not covered and would require separate flood insurance. Other water damage excluded in your property insurance policy includes damage caused by backup or overflow from a sewer system, drain, or sump pump.
Property Insurance Exclusions for Specific Property Items
High Cost Items: If items such as expensive jewelry, rare collectibles, or fine art are damaged or destroyed, they are generally insured up to $1,000. Valuables worth more than $1,000 require additional coverage under a separate insurance policy or rider.
Trampolines and Treehouse Injuries: Due to the high risk of injury from trampolines and treehouses, insurance policies often exclude injuries resulting from their use.
Pool Injuries or Deaths: While pool damage is covered in some instances, any injuries or deaths that occur in conjunction with the pool may not be covered. Other pool aspects that may raise your premiums or cause your insurance to be denied are diving boards, slides, or lack of a safety fence.
Items Excluded in your Homeowners Insurance Due to Neglect
Intentional Damage or as the Result of Neglect: Damaging your home on purpose or damage caused by neglecting maintenance on your home is not covered under any insurance policy. This can include termite or other insect damage, rot and mold, and general wear and tear.
Even a small, undetected leak can be excluded by your insurance company as neglect. Often the insurance policy will have additional language excluding a leak if it has been ongoing for more than 14 or 30 days, whether or not the property owner knew of the leak.
Frozen Pipes, Pressure, or Thawing Damage: Fences, pavement, swimming pool, and docks are not protected if frozen water causes thawing, pressure, or weight to damage your property. If you home is unoccupied, vacant, or under construction, frozen pipes and the damage they cause is also not covered by your policy. Thankfully, this type of damage isn’t a big concern in Florida, but homeowners with property further north should be wary.
All insurance companies add exclusions to policies to limit their liability in certain cases. Your home is your greatest investment, so do your research, read your current policy, and determine what additional coverage may be necessary to protect your property.
If you need help with your property claim, we can help. Contact Haahr Law for a free initial consultation.