The other night I was awoken by a pretty severe thunderstorm. Bright lightning and heavy rains lasted throughout the night. By daybreak, it had rained nearly three inches in the span of six hours.

Naturally, I thought, “time for an article.”

The heavy rain made me think about what would happen in the event of a flood. The reason why is that most home insurance policies specifically exclude damage from flooding. That is, if water seeps into a basement from heavy rains and damages the area, homeowner’s insurance would not apply. A specific flood insurance policy is needed.

However, a flood is not the only peril home insurance policies will generally exclude. In many cases, most home policies will exclude the following perils.

Flood

Earthquake

Neglect

Termites

War

Intentional loss

Additionally, most home policies (including renters or condo insurance) will exclude or limit coverage on personal property for the following.

Business Property

Cash

Antiques

Jewelry

Coins

Collections

Art

Firearms

Intentional loss

Automobiles (covered under auto insurance)

Lastly, many home policies will exclude or limit the amount of liability coverage on the policy from the following.

Business Use

Pools

Trampolines

Certain Pets (such as dogs deemed “vicious”)

Intentional acts

Illegal Acts/Activities

Many companies do allow policy owners to endorse their current policies. This means providing coverage separate from the home policy, for a specific item such as a wedding ring, firearm, painting, coin collection, etc.

If you’re in doubt, feel free to let us know or speak to your insurance agent.

Author: FINANCIAL DUCKS IN A ROW

Retrieved from: www.etftrends.com

FINRA Compliance Reviewed by Red Oak: 594302