Homeowner's Insurance: Spoiled Food After an Outage

The most popular type of homeowner's insurance sold in North Carolina to owners of single occupancy dwellings is what's called an HO3 Special Form Policy. This is the one that most people choose to satisfy the requirements of their mortgage holders. This type of policy is known as a hybrid since it provides “open perils” coverage for your dwelling but only “named perils” coverage for your personal belongings. It's not the most comprehensive homeowner's insurance policy available but represents the most economical way of complying with the insurance requirements of most mortgage lenders. An HO3 Special Form Policy can also be broadened in its coverage by the addition of special endorsements or riders if more coverage or higher limits are desired.

Sixteen Named Perils

The open perils coverage your HO3 Special Form Policy includes for your dwelling provides that all perils are covered except those specifically excluded in the exclusions portion of the policy. There may be dozens of exclusions, but since each individual homeowner's insurance policy may be unique, the only way to be sure of what's not covered in your insurance contract is to read and understand it. Almost all HO3 policies will have some typical exclusions, however, including floods, earthquakes, war, neglect, wear and tear and power failures, but there may be many more as well.

The named perils section that applies to your personal possessions will consist of a list of perils for which you're covered. In a standard policy, this list typically contains 16 perils such as fire or lightning, windstorm or hail, freezing, falling objects, vandalism, explosion and more. You'll notice that power outages and the spoiled food that may result from them aren't listed as named perils. This would seem to answer the question of whether spoiled food after a power outage is covered by your homeowners insurance. The fact is, though: like many questions related to home insurance, the answer is, “it depends.”

When Spoiled Food May Be Covered

In general, your insurance may cover the cost of spoiled food from a power outage (often limited to $250-$500) if the cause of the outage is a covered peril. For example, if the cause is a fallen tree in a windstorm or a lightning strike, it's likely covered, but not if the outage is caused by flooding or an earthquake. Your deductible applies, meaning the filing of a claim may not make sense.

 

Does Homeowner's Insurance Cover Water Lines?

Your Greensboro homeowners insurance policy is designed to cover a great number of perils, however, it may also not cover some things that you assumed it might. Coverage of damaged water lines is something that may or may not be covered, depending on certain conditions. These conditions can best be understood by carefully reading your policy and, if you're unclear about anything you read, getting together with your insurance agent or broker for a detailed explanation.

Sudden and Unexpected

One important phrase that likely applies as a condition in your Greensboro homeowners insurance coverage is “sudden and unexpected.” As a condition to any acceptable insurance claim, the event causing the damage must first be determined by your insurer to be both unexpected and sudden. This may include water damage resulting from a burst water pipe or a ruptured water heater, but with certain exceptions. Here are some examples of home water damage that are probably not covered by a standard homeowners insurance policy:

• A leak that's the result of wear and tear or old age
• A leak that's the result of lack of maintenance, such as one that started out slowly but was allowed to progress unattended
• Water damage that could have been prevented, such as frozen pipes that burst inside your home because the heat was turned off during cold weather while you were away
• A flooded or backed up sewage system is typically not covered
• Water damage or water line damage caused by ground water or flooding is typically not covered by your standard Greensboro homeowners insurance policy, although specialized flood insurance may be purchased separately

Two Types of Coverage in Your Policy

Sudden and unexpected damage caused by a burst water line or pipe within your home will likely be covered by your insurance policy and the claim may fall under two different sections of your coverage. If a wall, floor, ceiling or any other part of your home's structure is damaged and requires repair, your dwelling coverage will likely help pay for the needed repairs.

If you have personal property that becomes damaged as a result of a water event that's deemed a covered peril, it will be the personal property coverage in your policy that will help repair or replace the damaged items. This could be a computer or electronic sound system, furniture, clothing or other items susceptible to being damaged or destroyed by water.

5 Things Your Homeowners Insurance Won’t Cover

Homeowners insurance is something that's required to be in place for just about every homeowner with a mortgage and something that even those who own their homes free and clear shouldn't be without. Knowing exactly what's covered by your homeowners insurance policy, however, is not required, and many may not have completed the due diligence needed to learn just what's protected and what's not. You may falsely believe that your home policy protects you from any type of peril or damage your home may suffer.

While your coverage may, indeed, protect you from a long list of hazards that could possibly befall your home, there are plenty of potential hazards a standard homeowners insurance policy doesn't cover and you should be aware of these. The best advice is to thoroughly read your policy when you receive it and to consult with your insurance agent if you have any questions or confusion regarding the details of your coverage.

What is Usually NOT Covered

The following is a list of common, unexpected and expensive damage scenarios likely not covered by your standard homeowners policy. Bear in mind that, in the insurance business, just about anything CAN be covered if you're willing to pay the price required for the coverage. This, however, takes implementation of a special, custom designed policy or series of policies. Bear in mind the following when considering your coverage options.

1. FLOODING - some homeowners mistakenly believe their homes are covered for flood-related damages when, in fact, nearly all standard homeowners policies exclude floods from coverage protection. Homeowners desiring flood coverage must add an additional policy to their insurance portfolio. In this case, coverage can be obtained through FEMA's National Flood Insurance Program.

2. EARTHQUAKES - these disasters are also typically excluded from standard homeowners coverage. A separate policy must be purchased to cover for this peril.

3. SEWER BACKUPS - damage caused as a result of a sewer backup is excluded from most homeowners policies.

4. CASH - large amounts of cash stolen or destroyed in your home usually won't be covered. Other high-priced valuables such as collectibles, artwork or jewelry are typically covered only within a fairly low limit.

5. BURST WATER PIPES - while water damage caused by burst pipes may be covered by your policy, the cost to repair or replace the pipes probably isn't. If the broken pipes are the result of negligence, the claim may be denied altogether.

Do You Need an Umbrella Policy?

While it's common to be covered by a certain amount of liability insurance protection as part of your homeowner's insurance policy and your car insurance policy, the limits on this type of liability protection are often woefully inadequate in the real world when you're facing a serious liability lawsuit. A typical example could be if you're involved in a vehicle accident for which you are found to be at fault and held liable. If one or more other cars are involved and anyone in these vehicles (or bystanders) suffers serious injuries, the cost required to pay the damages and the medical bills associated with said accident could very well be disastrously high, perhaps even ranging into the millions of dollars. It's unlikely that you have the necessary coverage on your auto policy to handle such a situation. An umbrella policy could save your assets in this case.

Homeowner's Coverage

As a homeowner, you're responsible for someone becoming injured while on your property. You may even be held liable if you serve someone alcoholic drinks at your home and they drive away under the influence and end up causing an injury or death while driving home.

If you have a backyard swimming pool or a trampoline, your risk of liability is increased significantly, even if your yard is totally fenced and locked against the intrusion of neighborhood kids. Someone suffering a broken neck on your property while bouncing on your trampoline or drowning in your pool could add up to a liability charge far outstripping the limits of your homeowner's liability coverage limits, even if you've gone the extra mile and bumped your coverage up to $300,000 (which may be the most allowed on your particular policy).

Get an Umbrella                                              

Umbrella coverage is liability protection that works along with your ordinary liability coverage, kicking in once your other coverage becomes exhausted. Typical minimums on umbrella protection start at one million dollars, for which the cost is surprisingly affordable (usually around $200 annually), but you can increase your coverage to $2 million for about another $100.

This umbrella coverage is protection against the big liability judgements, meant to protect your current and future assets against large judgement claims. The more assets you have and the greater your income, now and in the future, the greater your need for umbrella protection. It's a small price to pay for a great deal of protection.