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Disasters that Insurance Policies do not Cover

Every year, many home owners discover there are certain disasters their policies do not cover. It is important to consider these issues before they happen and cause damage that will have to be paid for out of pocket. Earthquakes and floods are two types of disasters that a policy will not cover. 

Flood Damage Protection
Every home owner needs to know if his or her property is located in a flood zone. If it is, it is crucial to purchase a flood policy. In some cases, the government is slow to map out flood areas, so it is important to ask more than one source. To purchase a flood policy, discuss options with an agent. Flood insurance is provided by the National Flood Insurance Program. If a building is in a flood zone and its floor plans do not conform to plain building codes, the government requires it to be torn down after damages are more than 50 percent of its market value. People may purchase ordinance or law coverage, which is helpful for covering the costs of tearing down a building.

Earthquake Protection
Earthquake protection is not standard coverage in a homeowner’s policy. People who live in areas that are prone to earthquakes should purchase this coverage. Even if most earthquakes are small, history has shown that any areas prone to quakes will eventually have ones that are large enough to cause significant damage. For homeowners, there are special earthquake insurance policies with different types of deductibles. They are calculated on a percentage of the coverage instead of a specific dollar amount. For example, a homeowner who insures a property at five percent for $200,000 would have to pay for the first $10,000 of damages. 

Nearly every home needs one or more of these types of coverage. Homeowners who are not protected could end up paying thousands out of pocket for damages. The premiums for these types of policies or endorsements are affordable, so it is important to discuss options and review coverage with an agent as soon as possible.

For additional information, please call or email us.  

content provided by: http://eastcentral.aaa.com
Posted 10:57 AM  View Comments

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