Morse, Of Course, Wants to Make Sure That All Southeastern MA & South Coast MA Homeowners Are Informed About Their Home Insurance Coverage

Our team of dedicated insurance professionals have a real passion for educating our clients about insurance and how their policies protect them. In particular, we want to make sure that you understand all the critical coverages that are included in your standard homeowners insurance policy and, just as important, those that are not.

Your standard homeowners insurance policy is designed to offer you financial protection in the event of a disaster, theft or accident on – and sometimes off – your property. This important insurance acts like a shield, providing a strong defense against a variety of perils that can impact your home, your things, your lifestyle, and your personal reputation, via the following four essential coverages:

  1. Dwelling Coverage
  2. Personal Property Protection
  3. Liability Protection
  4. Additional Living Expenses

Each of these four areas of your homeowners insurance policy include coverage options, limits and exceptions that very few people outside of insurance experts really understand because, frankly, insurance language can be complicated. However, not knowing these details can often cost homeowners time, money and frustration in the event of a catastrophe. Which is why, Morse, of course, wants to make sure that our clients are completely in the know.

Dwelling Coverage

This particular coverage is the central part of your insurance policy; in fact, additional coverage in your homeowners’ policy are generally based on a percentage of what your dwelling coverage is set at. That’s why it is critical that you and your insurance agent work together to make sure you have selected the appropriate level of dwelling coverage for your unique home. You also want to make sure that, as you make changes and/or upgrades to your home, such as adding crown moldings, hardwood flooring or granite counter tops, that you stay in contact with your agent so they can ensure that your home insurance still provides sufficient dwelling coverage.

What is covered?

This essential coverage will help you repair or rebuild your home if it is damaged or destroyed by fire, hurricane, hail, lightning or any other disaster outlined in your specific policy. Additionally, most policies also cover your detached structures, like a shed, garage or gazebo.

What is not covered?

Dwelling coverage does not generally pay for damage caused by a flood event, earthquake, sinkholes, or routine wear and tear. In addition, issues related to poor maintenance on your part is not going to be covered either. This includes damage caused by termites or other insects, rodents or birds, rust, mold, and rot. It is also important to mention that some water damage will also not be covered by a standard homeowners policy. For example, in the event of a weather-related flood or if your sump pump malfunctions, any resulting damages to your property and belongings would not be covered.

Morse, of course, has a tip for you. We often recommend that our clients consider purchasing additional insurance endorsements to protect against some of the coverage gaps mentioned, such as a comprehensive flood insurance policy, Home Systems and Service Line Protection and/or Water and Sewer Backup.

Personal Property Protection

This coverage protects most of the belongings you have accumulated whether they are located in your home, garage, or even off-premise somewhere, like in a storage unit. Personal Property Protection is generally calculated to equate to at least 50 to 70 percent of your dwelling coverage, which is, as described above, the insurance you have on the entire structure of your home.

What is covered?

All your personal items, including your clothing, electronics, golf clubs, patio furniture and home décor, are generally covered, up to the limits of your policy, in the event of theft, damage or destruction by fire, hurricane or any other insured disaster. In addition, if your suitcase was misplaced or stolen while away on vacation, your favorite swimsuit, jean jacket and sandals would be covered too.

It is important to point out that the replacement value of your personal belongings are calculated based on their current value, or actual cash value. This means that if you purchased a Smart TV in 2014 for $2,000, and it was stolen or destroyed a few years later, you will only be reimbursed for what that same TV would be valued at today, minus depreciation and wear and tear. This cash value will probably only be a fraction of what buying a new Smart TV at today’s prices will cost you, so you’ll have to make up the difference out of pocket. On the other hand, you could choose to enhance your personal property protection with replacement cost coverage to ensure that any losses will be reimbursed at today’s current market value, meaning you would most likely be able to buy the latest version of your Smart TV!

What is not covered?

While a standard homeowners policy does provide broad coverage for your possessions, where it may fall short is in providing full protection for the items that have the most value to you, either sentimentally or financially. For example, expensive items, such as a diamond engagement ring, original art, or a signed Major League baseball, are technically covered under your homeowners insurance policy if they are lost or stolen; however, this protection only extends up to a certain dollar amount as specified in your policy, typically only around $1,500 – $2,000.

Morse, of course, has a tip for you. Actually, we have two! Our first piece of advice is that you conduct a home inventory of your personal belongings which could save you a great deal of time and frustration in the event you ever do have to file a claim. An inventory can be an overwhelming task, so the team at Morse guides you through the process in our blog, “How To Create A Home Inventory.” Second, in order to insure your high-valued items for their full replacement value, you will want to talk to your agent about adding a separate Scheduled Jewelry and Fine Arts rider to your homeowners insurance policy.

Liability Protection

This often-overlooked coverage provides you, and anyone else named on your policy, financial protection in the event that you are sued. It pains us to even mention this, but lawsuits are becoming increasingly more common today, which is why personal liability coverage is critical to have as part of your homeowners insurance plan.

What is covered?

This crucial part of your homeowners insurance coverage generally provides at least $100,000 in available coverage per occurrence, for things like:

  1. A lawsuit that you may face as a result of an accident that you, a family member, or a pet are responsible for, such as bodily injury to a person at your home or damage to another person’s property.
  2. The cost of defending yourself in the event that legal action, or a formal court proceeding, is brought against you, regardless if you’re found guilty or not guilty. This includes the hefty fees often associated with legal defense or counsel.

So, in the unfortunate event that you or a family member are sued for an injury, property damage, and even defamation, your homeowners liability protection will provide financial protection, up to the limits of your policy. In addition, personal liability coverage extends to your pets in case they bite someone or destroy someone’s property, as well as to a caregiver, au pair, or nanny.

Specifically, you can expect that your insurance will cover the costs of:

  • Personal Injury
  • Defense Costs
  • No-Fault Medical Payments to Others
  • Any Costs Associated with Property Damage
  • Any Judgments Against You

In addition, many people assume that liability protection only protects them if an incident occurs at their home or on their property. However, personal liability coverage in a standard homeowners policy generally protects you off property as well as internationally. Therefore, if you happen to be on vacation, and an unforeseen accident were to occur resulting in property damage, personal injury, a lawsuit or worse, this vital coverage could possibly protect you.

What is not covered?

Liability protection does not cover you in the event that you, a family member or pet causes damage to your own home. So, for example, if you were to trip and fall climbing the stairs or twist an ankle while playing fetch with Fido, your insurance policy would not provide coverage. Additionally, if you were to cause damage and/or injury due to a car accident, your homeowners insurance policy would not provide coverage; however, your auto insurance policy’s liability coverage could. It is equally important to note that the liability protection in your homeowners insurance policy does not extend to your business, even if you are a sole proprietor and work out of your home. Therefore, you should consider purchasing a separate business liability insurance policy.

Morse, of course, has a tip for you. If you have above average risks, such as owning a pet or swimming pool, have a teen driver at home, or a substantial amount of assets, then we strongly encourage you to talk to your agent about purchasing a separate personal umbrella policy. This critical coverage offers an added layer of liability protection, over and above what your homeowners insurance provides, and is a lot more affordable than you may think. For as little as $250 a year, you can purchase $1 million in coverage to ensure you and your entire family are safe guarded from the financial drain of a lawsuit. And, even if you don’t have a lot of high-priced assets or risky hobbies, you might still want to consider an umbrella policy in order to protect things like your current and future wages, financial investments, and, of course, your home.

Additional Living Expenses

Additional living expenses coverage kicks into action if your home becomes uninhabitable due to devastating damages caused by commonly covered perils, such as fire, smoke, windstorms, vandalism and more. Depending on your specific policy, the limit on this coverage is usually about 30 percent of the dwelling limit amount on the structure of your home.

What is covered?

In a worst-case scenario, like a fire or severe storm that leaves your home unlivable, additional living expenses is the coverage that pays for you, and any family members that live with you, to find reasonable living accommodations while your home is being repaired or rebuilt. This critical coverage also helps pay for a percentage of monthly expenditures that are above and beyond your normal expenses, including pet boarding fees, restaurant meals, increased mileage or transportation costs, laundry, storage costs, furniture rentals, and more.

What is not covered?

You can only claim this coverage if your home is made uninhabitable after a peril that is named as a covered loss in your homeowners insurance policy. So, for example, if your home is destroyed due to a flood, which is not covered under your standard homeowners insurance policy, and you do not have a separate flood insurance policy in place, then you will likely have to pay for any and all relocation costs out of pocket.

It’s important to note that most insurance carriers define an uninhabitable home as one that is unsafe to live in, and/or has no running water, heat or electricity. So, if you are simply feeling inconvenienced by repair work that is being done to your home as a result of a claim, but your insurer considers your home livable, this coverage is not going to reimburse any of these additional living expenses. Therefore, if you choose to move out temporarily to a hotel or regularly dine out while your house is under construction, you’ll have to pick up the tab for these expenditures.

Morse, of course, has a tip for you. While we hope your home never becomes uninhabitable due to a disaster, we want to make sure that you are properly prepared if something were to happen. Below are four critical to-dos that will help ensure you receive the maximum benefits from the additional living expenses portion of your homeowners insurance should you ever need to file a claim:

  1. Save detailed receipts for all your expenses
  2. Clearly document how the expenses are an increase from your normal monthly expenses
  3. Provide proof of your normal expenses so they can be used as a comparison point
  4. Receive written authorization for any special expenses ahead of time to avoid the possibility of a misunderstanding later

Keeping You Informed Is Just One More Way Morse Helps Keep You Safe

This information is meant to give you a better understanding of what is, and is not, covered under your standard homeowners insurance policy. With this knowledge in hand, we hope you will feel confident and better prepared for whatever homeownership may bring your way.

Because every home, homeowner, and homeowners policy is distinctly different from the next, we strongly encourage you to sit down with an experienced insurance agent, like the team at Morse. We will take an even more in-depth look at your specific needs and assess whether your current policy is sufficient to protect you, your home, and your loved ones now and in the future.

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