Homeowners Insurance: Taking an Inventory of Your Personal Belongings

If you're of a mind to get the most value out of your Greensboro homeowners insurance policy, you need to take care of an often overlooked detail. That's the creation of a comprehensive home inventory list of your family's personal belongings. You may have thought about doing this at some time in the past, but have neglected getting out your pen and paper and writing down the details. As an alternative, you could pull out your smart phone or video camera and make a complete documentary of what possessions you have in your home.

If you fall victim to a disaster such as a house fire that destroys your home and your personal possessions, a detailed inventory listing of everything that's been lost will be invaluable when making a claim on your Greensboro homeowners insurance policy. Having a detailed, up-to-date inventory list of your personal possessions can help in several ways:

1. Your insurance claim can be settled more quickly and more easily.
2. An inventory list can help you to verify losses you'll need to report on your income tax return.
3. Itemizing your personal possessions can help you in making sure you purchase and maintain the correct amount of homeowners insurance.

Where Do You Start?

Everyone knows that taking an inventory and documenting a list of your personal possessions is a good idea, but we also know it's easy to let a good idea slip by without taking the needed action to make it happen. Creating a complete possessions inventory can seem a daunting task, but it doesn't have to be. The trick is to START NOW!

You can start small, with just one room, and don't worry if you don't complete the inventory all in one sitting. A good plan can be to just do one room in your house per day, every day, until you've finished. Don't get overwhelmed. Even a partial inventory list is better than none.

Here are a few tips to consider:

• Record basic info on items such as where and when it was purchased, make/model, purchase price and serial number (if applicable).
• Record clothing by category, such as five suits, four pairs of jeans, 10 pairs of shoes, etc.
• Make special note of very expensive items (jewelry, artwork, furs, etc.) and make sure your policy covers them fully. If not, 
• add a floater.
• Store your completed inventory list in a safe, off-premises location.

4 Types of Insurance You Probably Don't Need

Some types of insurance you should have, such as life insurance, if you have a family depending on your income for their day to day living expenses. Some types of insurance you must have, by law, such as car liability coverage if you drive a vehicle on public roads in almost all of our United States. But some types of insurance are unnecessary and, although they may appear appealing when being described by an insurance salesman, you not only don't need them but they are likely to just be a waste of your money. Here's a list of a few insurance policies you're probably just better off without.

1. Child Life Insurance – child life insurance may look appealing at first because of its low cost and promised accumulating cash value, but that same money put into your child's education fund, savings account or even into your own additional life insurance coverage may be considerably more valuable. Life insurance is designed to provide financial protection to those depending on your income, and children typically have no income upon which dependents rely.
2. Flight Insurance – if you already have a life insurance policy in place, taking out extra coverage before flying in an airplane is redundant. Deaths in airplane crashes are relatively rare, but if you are unfortunate enough to suffer such an event, your standard life insurance policy already has you covered.
3. Rental Car Insurance - `buying extra insurance from a rental car company when renting a car may also be redundant, since your personal car insurance policy likely already covers you in a rental car. Double check your car coverage to make sure, and if you're not covered by your personal policy then the small fee charged by the rental car company may be worth the cost.
4. Auto Collision Coverage – if you're driving an old model car that's not worth a whole lot of money, you're likely better off forgoing the inclusion of collision coverage on your policy. This may also be said of the comprehensive portion of your policy. Instead, put the money you save on premiums in a car repair/car replacement fund to be used in the event your vehicle gets damaged or is stolen. For newer, more expensive cars, however, full coverage is probably your best bet.

These are just a few of the many types of insurance you can do without. Check here for more.

Car Insurance: What If Someone Else Is Driving My Car?

In the State of North Carolina, all vehicles being operated on public roads are required to be covered by at least a minimum of liability insurance. If you're involved in a car accident, either your car insurance company or the other driver's insurance should pay for damages. But what if someone else is driving your vehicle? Whose insurance pays then? As with many insurance questions, the answer to this one is, “It depends.”

Who's At Fault?

If someone else is driving your car and is involved in an accident, the liability for any damages falls to the driver deemed responsible for causing the accident. If the other driver is liable, their car insurance company will usually be responsible for paying damage costs.

If the person driving your vehicle is held liable, your car insurance company will usually be responsible for paying damage costs, with some possible exceptions. In most instances, your vehicle insurance applies to your car more than it applies to you as a driver. If your car insurance limits are not sufficient to pay for all the damages and the person who was driving your car has their own car insurance, their policy may contribute secondary payments after your policy limits are reached.

The Exceptions

There are three situations in which your car insurance may decline paying for damages caused by someone else who was driving your car:

1. The person driving your car and held liable for causing the accident is found to have been doing something illegal at the time. This could include driving without a valid operator's license or driving under the influence of drugs or alcohol.
2. The person who was driving your car was specifically excluded on your policy. You may have excluded someone from your policy because of their poor driving record that you knew would cause an increase in your policy premiums.
3. If someone is driving your car without permission and has an accident, your insurance company may refuse to pay a claim.

Other Considerations

When you lend your car to another driver, you are taking responsibility for their driving and if they cause an accident your insurance rates may go up because your insurer now sees you as a higher risk policyholder.

Your policy's deductible will need to be paid when making a claim. As the policy owner, you'll have to decide between you and the at-fault driver who will pay this.

Woodpecker Damage: Does Insurance Cover It?

There are lots of things that your standard homeowner's insurance policy covers. Also known as an HO3 Special Form, the HO3, which is what most homeowners carry for their homeowner's insurance coverage, is an “open perils” policy. This means that it covers all perils except those specifically listed in the policy's exclusions section.

A typical exclusion found in most HO3 policies is for: “Birds, Vermin, Rodents, Insects,” so, if you're wondering if woodpecker damage is covered in your policy, the answer is likely, “No.”

The reason woodpecker damage, or any other bird, vermin, rodent or insect damage, isn't covered by homeowners' insurance policies is because said damage is considered by insurance companies to be preventable. Their position is that prevention is possible by observing proper maintenance procedures.

Insurance Isn't For The Birds!

Some serious damage can occur when a persistent bird like a woodpecker decides to go to work on your home. He can drill holes through your siding, your window frames or your roofing. These holes can allow water and insects entry to your home and fungus and mold won't be far behind if left untreated. In addition to surface damage, structural damage can actually occur if woodpeckers spend significant time working on support beams.

While your homeowner's insurance doesn't cover woodpecker damage, there are things you can do to fix the damage and to prevent the same thing from happening again. Getting rid of insects, which woodpeckers feast on, can be a big help. Woodpeckers, however, use the noise that their pecking makes as a way of attracting mates, so different strategies need to be undertaken to get them to leave your property and go somewhere else. One idea that's worked for some is to place imitation owls or hawks in the areas where the birds have been causing trouble.

What About an Endorsement or Rider?

In most homeowner's insurance policies, even perils that are contained in the exclusions section can be covered by adding an endorsement (or rider) to the policy or adding an additional policy. Two common examples of this are the addition of flood insurance and/or earthquake insurance to your standard coverage.

An endorsement to cover the damage created by “Birds, Vermin, Rodents, Insects,” might be possible to obtain from some insurers for a price, since coverage for just about any peril can be negotiated for the right premium increase. Ask your agent.

5 Things to Know About Third-Party Life Insurance

Third-party insurance is nothing new, and though you may not be aware of it, you probably already carry some third-party coverage. Nearly every state in the country requires its drivers to maintain liability protection in case they cause bodily injury or property damage to a “third party” with their vehicle. Specific minimum amounts of that coverage are set and required by each state jurisdiction.

Third-party life insurance, however, is totally different than third-party vehicle liability (or any liability) coverage. Third-party life insurance is not something a policyholder buys for him or herself, but for a third party.

Third-Party Insurance Defined

In a third-party life insurance policy situation, there are three parties who are part of the agreement. The first is the policy owner, which is the entity (usually a person but not necessarily) that purchases the policy and is responsible for payment of the premiums. The second is the insurance company, and the third is the individual named in the policy, whose death would trigger payment of the death benefit to the named beneficiary or beneficiaries. Here are some other things to know about this type of policy:

1. As with almost all other insurance coverage, third-party life insurance requires that the policy owner have an insurable interest in the third party. Insurable interest regarding a life insurance policy means that the death of the third person (named in the policy) would cause material loss or financial hardship to the policy owner. An example of this would be an individual taking out a policy on his wife or child.
2. While the first party in the 3-party life insurance policy is often a person, it may also be an entity such as a company for whom the insured is a key employee or officer.
3. The person being insured in a third-party life insurance policy must be aware of and consent to this arrangement. An exception to this rule exists when a parent buys a policy to cover his or her newborn child, who is too young to provide consent. Buying coverage for a child may seem unusual, however, if the child becomes ill and passes away, the medical bills left behind would cause financial hardship to the parents.
4. The first and third parties to a third-party life insurance policy cannot be the same.
5. The beneficiary need not be a person but could be a company, a trust, charity or some other entity.

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.

 

Your Homeowners Insurance and Diseased Tree Removal

When thinking about the coverage found in your Greensboro homeowners insurance policy, two words should be kept in mind – abrupt and unforeseen! While your policy is designed to cover a large number of perils that could possibly cause you serious financial loss, these perils, by nature, must be both sudden and unexpected in order to be covered.

If you have a diseased tree on your property, maintaining the safety of that tree falls within your homeowner's maintenance duties and it is not covered by your Greensboro homeowners insurance policy. Should that diseased tree suddenly fall down, your insurance company will likely see this as a preventable situation and deny a claim. If the tree comes down in a storm or is struck by lightning and falls over, it may be covered by your insurance, but only if it was a healthy tree to begin with. If it was a diseased tree, however, the claim will likely be denied because you should have known in advance that it was at risk of falling down due to its health status.

Negligence, Accident or Maintenance

When you have a tree growing on your property, your insurer assumes that it's your responsibility to keep it healthy or to have it removed. To them, this is proper and prudent maintenance and failure to do so would be negligent. If this tree falls down onto your lawn, your insurer will expect you to foot the bill for removal and cleanup.
If, however, a tree falls onto your house, your fence or your car as the result of a wind storm or a lightning strike, this should be covered by your Greensboro homeowners insurance policy even if the tree was diseased. It would be best to check your policy for specifics on this matter and discuss it with your agent if you're unclear about your coverage. Take note that trees damaged on your property as a result of flood or earthquake are typically not covered by your standard homeowners policy.

Coverage Limits

If you have a fallen tree that your insurer agrees to pay for in removal and cleanup costs, there will generally be a limit to the amount they'll pay. Although each insurer and homeowners policy may differ on this, a typical limit is 5% of your policy's dwelling coverage limit per claim. There may also be a per tree limit, such as $500 or $1000.