7 Things about Your Homeowner's Policy
That Could Cost You Money

So you have a homeowner's insurance policy.  Do you know what it covers?  More importantly, do you know what it doesn't cover?  Consider these 7, not so uncommon, situations:

  1. Coverage Limits below Replacement Value.
    If the actual replacement cost for your home is greater than what your coverage limits - perhaps set long ago - you could be penalized in your claim and receive a settlement that forces you to dip into savings or borrow to adequately replace your dwelling.  Replacement Cost Coverage protects you against this happening. 

  2. Ordinance/Law Coverage.
    Also known as "rebuilding to code".  Entire parts of your rebuilding project could be excluded from coverage if your policy does not provide for this eventuality.  It is very important that owners of older or antique homes have this coverage.  

  3. Unlimited Loss of Use.
    The length of time to rebuild your home could be longer than what your policy will pay for you to live temporarily elsewhere.  Most policies limit the amount of cash they will pay to cover your temporary living expenses.  Antique homes or homes requiring exceptional levels of craftsmanship can sometimes take a long time to recreate.

  4. Replacement Cost Cash Option. 
    Suppose you wanted to rebuild your destroyed home at a different location.  Or even decide not to rebuild at all.  For most policies in this case, you could only collect the Actual Cash Value (ACV) of your home.  The ACV could be much lower than the replacement cost.  To cover this situation you would need a policy that gives you the choice and will pay replacement cost regardless of where you rebuild. 

  5. Debris Removal. 
    Did you know that much of the debris after a fire is considered Hazardous Waste?  Did you know that paying for the removal of hazardous waste is extremely expensive?  You need to have a policy that pays this in full.

  6. Back-up of Sewers and Drains and Malfunctioning Sump Pumps. 
    It happens and when it does there is always a big mess.  Back-ups of sewers and drains are typically not covered by standard homeowner's policies.  You need a policy that will cover you. 

  7. All Risk Coverage on Personal Property. 
    Have you ever spilled paint on your oriental rug?  Dropped your big screen TV while moving?  Spilled a soda on your brand new laptop PC?  None of this is covered under a standard homeowner policy.  For coverage of these types of typical homeowner accidents you will need a policy that will pay for these type of incidents.

    So you see, all homeowner's policies are not created equal.  Call your insurance expert at Pilgrim Insurance Services to review your policy.  We are happy to explain what is and what is not covered and discuss the risk and cost implications of coverage options with you in detail.