The insurance pros at the Equifax Finance Blog debunk some popular homeowners insurance myths in their new article, “Seven Common Homeowners Insurance Myths.”
Here’s a rundown of a few:
Myth: Your insurance will cover your home while you take up temporary occupancy elsewhere.
Fact: In most states, the homeowners policy covers “a residence regularly occupied and furnished for the personal use of the named insureds and their resident relatives.” Once you change occupancy, your policy may deny a claim on the property. If you are having construction done as the reason for your temporary move out, you’ll need a builder’s risk policy to cover your property while under construction.
Myth: Your insurance will cover damage caused by wind at replacement cost.
Fact: Items damaged due to wind are subject to depreciation and paid on an actual cash basis on most homeowners policies.
Myth: Your neighbor’s policy will reimburse you for damage caused by one of their trees falling onto and damaging your fence during a storm.
Fact: Wind is an act of nature and your neighbor would not be held liable for the damage. This would be a claim against your own homeowners policy, subject to your deductible.
Myth: Your $1,000,000 liability homeowners policy means that you do not need an umbrella policy.
Fact: Your liability coverage would protect you if someone trips and falls on your property or if someone is injured playing in your backyard; it will not cover you if you seriously hurt someone while renting a car or boat on vacation. In a situation like that, you may need an umbrella insurance policy.
Their bottom line is to get in touch with your insurance agent to review your policy to make sure that you are adequately covered, or if you need to purchase additional protection. Read the full article and get more insurance advice on the Equifax Finance blog. While there, check out the wealth of advice on all kinds of personal finance subjects, from insurance to credit scores to real estate to taxes, identity theft protection and more.