ENDORSEMENT HOME INSURANCE



Earthquake Coverage


Earthquake coverage is a common exclusion on homeowners policies. Given the amount of widespread property damage that occurs during an earthquake, many companies exclude coverage for earthquakes because of the financial risk. Depending on your location and insurance company, you might be able to add an earthquake endorsement to your policy.


If you live in Hawaii, Alaska, Missouri, Kentucky, Idaho, Illinois, Montana, Tennessee, Utah, Wyoming g, Nevada, or South Carolina, consider adding an earthquake endorsement to your home insurance.


Windstorm Coverage


If you live in a state that's vulnerable to hurricanes — usually coastal areas — your homeowners insurance might specifically exclude windstorm damage if your home is damaged by severe wind or a hurricane. While hail and wind damage is usually a named peril on a typical home insurance policy, insurance companies can choose not to assume the financial risk of extending this coverage to areas that are susceptible to hurricanes.


Depending on your insurer, you may be able to supplement your home insurance with a windstorm endorsement. If it's not offered as an add-on, a separate windstorm hazard insurance policy could be purchased. If you live in a state where hurricane deductibles apply, you would be responsible for that separate deductible if you want your insurance company to cover your windstorm or hail-related damages.


Can't find windstorm coverage or windstorm insurance? You may have options via state run insurance programs, like FAIR Plans (Fair Access to Insurance Requirements) or a Beach Plan if you live in a coastal area.



Extended replacement cost coverage


This coverage raises the amount you will get for your dwelling coverage if the repair cost exceeds your limits. This is common after natural disasters in which the demand for labor and supplies drive up prices. Most companies will extend your replacement coverage 25% to 50% — but this can vary. For example, a wildfire tears through your home and many others in California. Ordinarily, your home would cost $300,000 to rebuild but the increase cost of repairs due to the massive wildfire raised the total replacement cost to $370,000 — $70,000 more than your coverage limit. Without extended replacement coverage, you would be forced to cover that $70,000 difference. If you have 25% of extended replacement cost coverage, your unseen $70,000 would be covered.


Sewer backup coverage


Water damage is a tricky area for most insurance companies. A standard homeowners insurance policy covers water damage caused by:

  • Weight of ice, snow, or sleet

  • Discharge and overflow of water

  • Tearing apart, cracking, burning, or bulging of a steam or hot water heating system

  • Freezing of plumbing


Sewer backup coverage would be necessary if water were to overflow into your home via the home's plumbing system. This may occur because of a blockage, old pipes, tree roots, or construction issues. Because it may involve contaminated water, it can make your home unsanitary and damage your personal items.


Without this endorsement, you would have no coverage in the event of a sewer backup. Generally, this coverage isn’t too expensive. It may raise your homeowners premium by a few bucks per month.


Food spoilage coverage


Let's say your fridge is fully stocked but a weather event downs power lines in your neighborhood, causing your fridge to lose power for a few days and making your food rot. Because your power was cut due to a covered peril like a windstorm, having this endorsement ensures that your insurance company will cover the cost of the spoiled food. Power outages are generally the only kind of event homeowners insurance will cover when it comes to food spoilage — and it's up to the individual policy and insurer whether they'll cover instances where it's only your residence losing power versus your whole neighborhood. This endorsement could be helpful if your home is located in an area vulnerable to storms and power outages — especially if those outages tend to last longer than a day.


Additional personal property coverage


Most insurance companies limit their liability on certain valuable personal property items. Jewelry, fine art, and even firearms come with specific coverage limits, i.e., the most your insurance company will reimburse you after a coverage claim.


If you have one particularly valuable item of personal property, such as an engagement ring, consider a scheduled personal property endorsement. This would require you to appraise the item but would give you individual coverage.


Personal property replacement cost


If your dwelling — the physical structure of your home — were damaged or destroyed, you would be reimbursed on a replacement cost value. Your insurance company would pay a claim to cover what it costs now in order to rebuild or repair your home (up to your coverage limits). On a standard homeowners policy, your personal belongings are not covered this way.


Typically, contents and personal property are covered on an actual cash value basis (ACV). ACV considers depreciation whereas replacement cost does not. For example, if a couch you bought three years ago were destroyed, an ACV payout would give you the value of a three-year-old couch, not the value of a new couch.


If your contents are deemed a total loss, an ACV payout basis can leave you with less than you had before. Because of this, it is generally recommended to insure your personal contents on a replacement cost basis.


Identity Theft


Identity theft coverage on a home insurance policy is usually relatively limited. It will not cover any reimbursement for stolen funds but can help cover court costs and reimburse for time lost at work.


Personal Injury coverage


This endorsement provides coverage to you or your household members for personal injuries. This includes false arrests, wrongful eviction or entry, invasion of privacy, slander, and defamation. The personal injury endorsement goes beyond liability coverage to protect against any emotional damages that might occur, covering your defense costs and any potential settlement fees up to your policy's limits.


Limited fungus/mold coverage


Mold is a tricky aspect of homeowners insurance. Sometimes, your homeowners will cover mold damage if it is caused by a covered loss. This coverage kicks in to cover the below:


  • Direct physical loss or damage: replace what was damaged by the mold, including carpet

  • Cost to tear out and replace

  • Cost of testing


Fungus and mold coverages typically max out at or near $5,000.




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