Home Owners Insurance Repairs

“Many homeowners don’t understand what their home owners insurance policy covers and excludes.

Case in point: More than 30 percent of U.S. heads of household who have homeowners insurance mistakenly believe flood damage is covered by a standard homeowners policy, according to a 2007 survey from the National Association of Insurance Commissioners.

To avoid making costly assumptions, it pays to know what’s included in your policy, especially because homeowners policies may differ from state to state.

“Most people think when they call an insurance agent and ask for homeowners insurance that all policies are the same,” says Michelle O’Connor, owner of O’Connor Insurance Associates Inc. “They are not. Regardless of what state you are in, there are different policies.”

Regardless of where you live, however, a home insurance policy will cover more than just structural damage to the property. Here are several surprising coverages that are typically included in homeowners insurance.

Surprising things your home owners insurance covers

While home insurance policies vary, the standard basic policy is called an HO-3 home policy, says O’Connor. Some insurance companies might call it something else, but HO-3 is the common name for it. This policy provides coverage for “ordinance or law,” which covers costs associated with bringing the property up to code after a covered loss.

For example, “If a house burned down and a new law requires homes to have sprinklers as in the state of Pennsylvania, upon rebuilding, the sprinklers would have to be installed. This coverage provides the money to do that, but there is a limit that is a percentage of the home coverage,” O’Connor says.

The basic homeowners policy also provides coverage for the owner’s refrigerated items. If a power outage spoiled all your freezer and fridge items, the insured has coverage for up to $500 under this particular policy, she says .

Ordinance coverage or the refrigerated item coverage does not cost extra for the homeowner, according to O’Connor. It is included in the policy. However, you can purchase additional ordinance or law coverage if you think you need it. Ask your insurer about this coverage for further details.”

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Sourced from Bankrate