Which two perils are not covered under a standard homeowners insurance policy?

Standard homeowner policies cover a wide range of potential disasters, from tornadoes to lightning and winter storm damage. However, policies vary, so for your peace of mind, check yours to see the specific risks that are covered. Learn what each type of homeowners insurance policy generally covers and what it doesn't. Your homeowner's policy doesn't cover all the damage caused by a volcanic eruption; you may need more coverage.

Flood damage is a very common exclusion from HO-3 policies, but even homeowners with HO-5 policies, which offer broader coverage than HO-3 policies, are unlikely to be covered for flood damage. You may want to consider setting aside some of the money for home maintenance, so that you have the necessary funds to cover the costs should a problem arise. If a customer slips and falls while visiting your home office, your home insurance will most likely not cover the resulting medical expenses or legal fees or settlements if that person decides to sue. Depending on the type of homeowners insurance policy, your home may be protected against certain risks, which are specific incidents, or against all hazards except those that are specifically excluded.

You'll need flood insurance that covers you against floods, flood-related erosion, abnormal storm surges, and mudflow. If you have more expensive possessions, such as high-value jewelry, ask your home insurance company if they offer promotions for high-value items. If you live in an area that is particularly prone to earthquakes, you may need to purchase a separate earthquake insurance policy. Other exclusions, such as floods or earthquakes, can cause such catastrophic damage that they justify having your own qualification metrics separate from those of a home insurance policy.

For example, if a storm breaks a window and water damage causes mold, you might have a cover to get rid of the mold. If your homeowners insurance policy doesn't cover a particular risk, it's called an exclusion. While anyone can purchase flood insurance, the mortgage lender may require you to have flood insurance if your home is located in a high-risk flood area, as determined on the Federal Emergency Management Agency (FEMA) flood map. Likewise, most homeowners insurance policies have a limit on the amount of personal business property coverage you have, and some policies may exclude coverage altogether.

There's usually no separate guarantee or policy you can take out to get insurance coverage for these types of losses.

Carl Somilleda
Carl Somilleda

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