Replacement cost is usually the best option for both your home and your possessions because it is the amount you would pay for a new item at today's costs.

 

Cash value is replacement cost minus depreciation, meaning that you pay the difference between the depreciated value and the cost of the new replacement item.

 

There's an excellent overview of these insurance coverage details on the non-profit FLASH® website.

 

 

No, standard home insurance does not cover flooding.

 

This exclusion typically extends to events such as mudslides, water seeping into basements due to poor drainage, and blocked sewer lines. 

 

Flood insurance is available both privately and through the federal government's National Flood Insurance Program (NFIP). The NFIP used to be the go-to option, but these days private flood insurance is often less expensive and offers higher limits.

 

Here's a helpful article from ValuePenguin that compares private and federal flood insurance.

 

 

 

 

For example, if wind tears off part of your roof and rain damages the interior, this would typically be covered. If wind and rain create a storm surge that floods your home, however, you most likely would not be covered.

 

 

 

 

 

Trampoline accidents often involve spinal cord injuries that require expensive treatment. Some insurance companies prohibit trampolines entirely, whereas others may simply ask for safety netting to be installed. 

 

If you have a trampoline, it's worth finding out if you're covered. If you're not, you risk paying out of pocket for potentially huge medical expenses.

 

 

 

What's an attractive nuisance? Think swimming pool, swing set, fountain, trampoline, farm equipment, abandoned vehicles... basically, anything created or maintained by you that a child could wander into and harm themselves with.  

 

Let your insurance company know if you have an attractive nuisance on your property, and take reasonable precautions to protect visitors (even trespassers). Homeowners are expected to either make the attraction inaccessible to curious children or eliminate the danger entirely, according to NerdWallet.

 

 

 

 

 

Insurance companies paid out over $800 million in liability claims in 2019 for dog bites and dog-related injuries. In fact, the average dog-related claim now costs over $50,000! This is why some companies no longer issue policies if the homeowner has a breed of dog deemed to be dangerous based on bite and fatality statistics.

 

There doesn't appear to be one standard compilation of breeds used by all companies, but you can see a list of the usual suspects in this article on the Coverage website.

 

 

 

 

Your neighbor's policy might kick in if you can prove that the tree was likely to fall and you had asked them to remove it before it damaged anything, but that would be an exception. 

 

Note:  When a tree (yours or theirs) falls on your property without damaging or resting upon an insured structure, the event may not be covered at all.   

 

 

 

No, most policies exclude loss from earthquake damage. Earthquake insurance can be purchased separately.

 

 

 

 

 

This is a crucial step that protects you against lawsuits, but many homeowners overlook it. Several million dollars worth of coverage typically costs only a few hundred dollars per year. 

 

 

Use a home inventory software to keep track of your belongings. Here's a list of 9 Top Home Inventory Apps, many of which are free. 

 

 

More than one claim in a 3 or 5-year period could get you dropped, so think twice before making small claims. 

 

 

If you call to find out if an event is covered, make sure they know you're only making an inquiry, otherwise your question could count as a claim. It may be safer to call your individual agent rather than the main company number.

 

 

The Lighter Side