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Mary Mastroeni
Mary Mastroeni
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What Don’t You Know About Your Homeowners' Policy?

May 17, 2017 12:30 am

Protecting your home, property and possessions are extremely important. So understanding things like coverage available for earthquakes and floods, liability coverage and how to shop for homeowners' insurance are important, too. You don't want to spend too much, but you want to be sure you understand and have the right amount of coverage to fit your needs.

Many of these concerns are analyzed the latest Insurance Information Institute (I.I.I.) Research publication "Homeowners Insurance: Understanding Attitudes and Shopping Practices."

A review of that study at points out that a majority of homeowners are aware their policy provides coverage for damage caused by fire, hail and wind. And most also know that items stolen from their house are covered.

However, many homeowners were found to be unaware of a variety of perils that are covered by standard policies - and incorrectly think that certain events are covered, when they're not.

Jayleen Heft, who related some of this analysis for the website, found only 44 percent of consumers comparison shop for homeowners' insurance (by any method) when their policy comes up for renewal. SIxty-nine percent indicated they comparison shopped for auto insurance at renewal time.

A few of the other key stats Heft discovered were:
- The most popular method for homeowner insurance comparison shopping is by speaking with an insurance agent in person (29 percent).
- Only 31 percent of Americans consider homeowners' insurance to be a financial burden- a significant drop from the 49 percent ratio in 2009.
- A startling 43 percent of homeowners incorrectly believe damage from heavy rain flooding is covered under their standard insurance policy. The percentage of homeowners who purchase flood insurance has averaged 10 percent to 14 percent since 2010, according to I.I.I.
- Heft says 28 percent of homeowners incorrectly think hurricane storm surge flood damage is covered by a standard homeowners' policy, and 29 percent incorrectly think that their policy covers earthquake damage.
- Fifty-five percent of homeowners think they have coverage for a sewer backup. Some homeowners' policies may provide coverage for sewer backups under certain circumstances, generally, Heft says sewage backups are not covered without a rider or separate policy.

Check out the full study here.

Published with permission from RISMedia.