Home insurance is used to protect your interests should damage come to your home. While home insurance is often required if you hold a mortgage, and highly recommended even if you don’t, there are lots of misconceptions when it comes to coverage and home insurance in general. These can often lead to home insurance disputes.  Here are some of the most common misconceptions about home insurance.

These Misconceptions Often Lead to Home Insurance Disputes

Flood Damage

There is a world of mythology surrounding flood damage when it comes to home insurance.  One of these misconceptions is that damage is covered by standard homeowner insurance.  Because of recent tragedies, many people are aware now that floods are not covered. A separate flood insurance policy is required and must be added to your contract in order for flood damage to be covered. Another misconception is that you only need flood insurance if you are in a flood zone. The truth is, floods can happen anywhere. Flood insurance is a good add-on to have on your insurance.

Possessions

Many people believe that if it’s located in your home, your home insurance will cover it. The truth is, there are many categories of personal belongings that typically have a cap.  You should be familiar with these limitations and prepared to pay additional coverage for items that greatly exceed the value of the coverage.

Mold

Mold damage is another source of rumors. Most homeowners believe that mold is covered by their home insurance. However, most insurance policies specifically do not cover neglect.  This means that if the mold resulted from a leaky faucet or pipe, or anything that could be classified as neglect, your insurance company can fight the claim and may refuse coverage.

Amount Needed

Many people are confused as to how much home insurance they need. Most people will base their home insurance coverage on the purchase price of their home. The truth is, you don’t need to count your land as part of your coverage. What you are hoping to cover is the replacement cost of your home, meaning the structures on your property. Do not factor in the cost of the land.  Instead, use the money you save on your Premium Too cover other items, such as additional replacement cost or additional policy add ons such as flood damage.   Without understanding your insurance, you can’t possibly defend yourself if a claim is wrongfully denied. Make sure you understand your homeowners policy, and if you need help seek legal advice from our experts on home insurance disputes. Sources: FOX