Top 10 Homeowners Insurance Myths

Most homeowners consider the contents of their houses priceless, especially if the house has been in their family for generations. A house is one of the biggest investments of a family that is why it should be insured against loss by fire, flood, falling tree or other accidents that may cause damage to it and its contents. Possessions can also be stolen and it will cost a lot to replace them.

  1. There are many myths that have to be cleared up regarding home insurance and its features. The first myth is flood insurance coverage. Flood is not covered by a standard home insurance policy. A separate flood insurance policy should be purchased to cover flood damage.
  2. Another myth is the MedPay coverage for physical injuries of a home insurance policy. MedPay covers injuries of people that will get hurt on your property so that they will not sue you, so it does not cover you and permanent residents of your home.
  3. The third myth is the reimbursement of everything you owned that was lost. Your insurance company will require a list of your possessions and their purchase price, the date they were bought, identification numbers and specific descriptions. The best way is to photograph and list everything your home contains and keep it somewhere other than your house.
  4. The fourth myth is the belief that the home insurance premium goes up whenever a claim is filed. Insurance companies take claims history into consideration but other factors are included in the determination of home insurance premium.
  5. The fifth myth is expecting jewelry and all valuables to be covered in case of a burglary. Most home insurance companies will only pay a limited maximum amount when jewelry is taken during a home burglary.
  6. The sixth myth is assuming that home insurance will cover mold and loss caused by maintenance problems of the house or the lack of its care. Standard home insurance only cover perils like lightning, hail, wind, theft or fire.
  7. The seventh myth is thinking that only people living in a flood zone should get flood insurance. Lending companies and mortgagors require clients to pay for flood insurance in Flood Zone areas. Additional coverage should be bought for flood coverage.
  8. The eighth myth is trying to save money by skimping on home insurance coverage. Adequate coverage is always important, so it is better to find premium discounts than reduce coverage.
  9. The ninth myth is using the purchase price of the house as the amount of home insurance coverage. The purchase price of the house includes the land, which do not suffer damage. The coverage should be the cost of replacing the home and its contents and should not include the land it is standing on.
  10. The tenth myth is that it is not possible to buy a house without paying for homeowners insurance. Lenders require home insurance, so if you are paying in installments home insurance will be required. If you are paying cash for the house, no one will require you to buy home insurance but the risks remain and it is not recommended that your house remain unprotected.
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