Insurance requires you to plan for the worse case scenarios. Although it is pessimistic to think about what could happen, but it's important to protect yourself from some of life’s biggest surprises.
Know What It Covers
Typically a policy pays for damage to your property and your possessions in the event of certain storms, fire, theft or vandalism. Much like renter’s insurance, it also provides liability coverage if someone gets hurt on your property and decides to sue. Homeowner’s insurance also covers shelter costs, so you don’t have to face crazy hotel bills if you’re temporarily displaced from your house.
Homeowner’s insurance can protect belongings outside the home, too. If something is stolen from your car, auto insurance won’t cover it—but your homeowners policy likely will. Most policies cover your belongings when they are traveling with you, for example, a laptop. Make sure you have a picture of it as well as have added it to your policy, of course.
Know What It Doesn’t Cover
A standard policy has does have exclusions, including earth movements (landslides, earthquakes, sinkholes), power failure, war, nuclear hazard, government action, faulty zoning, bad repair or workmanship, defective maintenance and flooding. Windstorms are typically covered, including tornadoes, although insurance companies exclude tornadoes or hurricanes in some high-risk areas.
Water damage can be tricky. If you live most places in Florida, you are required to have some form of flood coverage. Under regular homeowner's policy, generally water from above (rainwater or a burst pipe in an upstairs apartment) is usually covered, but water from below (backed-up sewers or ground flooding) generally isn’t.
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