1. Assuming All Damage Is Covered
One common mistake is assuming that all types of damage are covered under a standard policy. For instance, while sudden incidents like fire or wind damage are typically included, other events such as flooding or water damage due to poor maintenance are often not. Homeowners need additional coverage for floods, and maintaining their property (like cleaning gutters and checking roofs) is essential to avoid denied claims.
2. Ignoring the Fine Print on Coverage Limits
Many people don’t realize that policies come with specific limits, especially when it comes to high-value items like jewelry or collectibles. To be fully protected, homeowners should consider adding riders or endorsements that extend their coverage beyond the standard limits.
3. Neglecting to Update Policies Over Time
Homeowners often forget to update their insurance policies as their homes change. Renovations or even acquiring new belongings might require adjustments in coverage to ensure that the property’s value and contents are adequately protected.
4. Filing Too Many Small Claims
While insurance is there for protection, filing too many claims, especially for minor issues, can lead to higher premiums or even policy cancellation. Insurance companies may view frequent claims as risky behavior, so it’s advised to reserve claims for more significant, unavoidable events.
5. Review Your Policy Annually and Consider Shopping For a New One If Premiums Have Risen or Coverage Has Changed
Since insurance premiums are often bundled with mortgage payments through escrow, many homeowners overlook the opportunity to compare and potentially lower these costs. As premiums increase, they might assume it’s a standard adjustment, but homeowners have the right—and are encouraged—to review their insurance policies annually. By shopping around, they can ensure their coverage meets their needs and that they’re getting a competitive rate.
Should you have any questions or need a recommendation to a good insurance company, please reach out directly at 720-250-7764 or nick.ross@edgehomefinance.com.
