Myths and misconceptions: homeowners insurance
Like many other elements of the insurance industry, homeowners coverage is subject to a number of mistaken beliefs widely held among American consumers. Unfortunately, these myths continue to exist – creating a widespread misunderstanding of many important details regarding homeowners insurance, premiums, what is covered by the typical plan, and more.
However, individuals who are able to see the truth behind these myths and misconceptions will have a leg up in more ways than one: they'll be better suited to obtain a homeowners policy that serves their needs exactly, and they'll be better prepared to recoup their losses in the case of damage as a result. Below, we debunk a few of these myths – if you can see the truth, you'll be better prepared to obtain a homeowners policy that's right for you and your family.
Making a home inventory is an unnecessary task
Many people mistakenly believe that making a home inventory is an unnecessary task if they've already taken out a homeowners policy. That couldn't be further from the truth: you'll want a record of every single item in your house that could potentially be subject to damage when you take this policy out. This ensures that no lost item will go without reimbursement in the case of home damage – and it'll also ensure that you won't forget a single detail when filing for a reimbursement in such an event.
A family's belongings are covered under house insurance, even if they aren't in the house
Many believe that items owned by their children are covered under homeowners insurance even when those children move out, and take those items with them. These items may be covered under some policies, undoubtedly – but in many cases, any items that are residing outside the home, even if not permanently, will not be covered under a homeowners insurance policy. So when you're checking out home insurance quotes, make sure you make a detailed note of the parameters regarding items that aren't actually located within your home, and you can be sure that you won't run into any unexpected complications in this regard.
Homeowners insurance premiums go up with every claim
Many people have the mistaken impression, perhaps due to their experience with car insurance coverage, that homeowners insurance premiums can go up every time they make a claim. While numerous claims will likely send your premiums upward, an individual claim is unlikely to cause a bump in your premium costs. If you're feeling uneasy about taking out an extensive homeowners policy, this is something to keep in mind.
If my home is damaged by a neighbor's property their insurance covers the cost
This is a myth that you can't afford to believe. If inclement weather knocks over one of your neighbor's trees, for example, and it causes damage to your home or property, then it's likely the reimbursement will have to come from your own policy – not from your neighbor's. So keep an eye on who is liable for damage caused by weather, by property that originates on the land of other homeowners, and other such vagaries when signing up for a homeowners insurance policy. You never want to be the one caught off guard by the cost!
All homeowners policies are essentially the same
Some people are under the mistaken impression that there isn't much difference between different homeowners insurance policies – in short, many believe that all policies offer protection against the same things. However, there are many different factors that differ from policy-to-policy quite regularly. Some policies may cover you against damage caused by termites, while others may not. Some may protect you against flood damage, while others make no mention of losses caused by water. For this reason, you should study up on your policy as if you were preparing for an exam – you want to know every single potential incident that is and isn't covered before you sign on the dotted line.
Receipts are not necessary for major damage claims
Many individuals believe that they don't need to keep extensive records regarding the costs of the items in their home, because an estimate will occur in case of damage and provide them with the reimbursement they're owed. Yet you never should leave your own property in someone else's hands. So keep all receipts and documents regarding any purchase, even the small ones. That way, you'll always be able to provide proof in regards to value, in case you need to make a claim against your homeowners insurance.