What Insurers Don’t Know About The Trials And Tribulations Of Owning Property

We buy a property to dwell in with your family, or for commercial benefit. Either way, we have to take care of the financial and other risks pre and post-purchase to make the most of the investment. One such consideration is buying insurance to secure your property from potential threats, like damages, disasters, and liabilities. 

Many insurance companies offer insurance. They tend to look at insurance from their own perspective. They’ll make sure you have enough coverage to be happy with their services, but they won’t go above and beyond to find out what you really need. In fact, in many cases, they won’t know how to go above and beyond. Why?

It’s because they simply don’t have the experience. They know the policy; they don’t know the trials and tribulations of owning property. For eg., they can’t anticipate the problems that will arise when a new law is passed locally – it never occurs to them to keep up with those developments until disaster strikes. The thing is, we do.

In addition to providing insurance for our customers, we also own commercial and apartment buildings. We’ve renovated properties and we know exactly what can go wrong. We understand firsthand the many complications that can arise in case of damage, and what protection you need to stave off disaster. Of course, we also own homes and properties.

According to a report by Insurance Information Institute, 98.1% of property insurance claims were made for damages to the property in 2018, of which wind and hailstorms accounted for 34.4%, while water damages accounted for 23.8%. Fire and lightning caused 32.7%, and burglaries contributed to about 1% of the total damages. There’s a lot an average homeowner faces.

Let’s use this blog to talk about some examples of the big and small trials and tribulations of owning property (that your big-brand insurer probably doesn’t factor into policies).

Protection against natural disasters

Most insurers don’t cover the damage caused to your property by natural disasters over a considerably large geographical area. For example, if there’s damage to your property because of a hurricane that ravaged a large area of North Carolina, you won’t get your claims approved by the standard homeowner’s insurance. Floods, earthquakes, nuclear accidents, or any act of war are also not covered under the policy. You may need to buy separate insurance products or extensions to your homeowners’ coverage to secure your property from such massive damages. 

Negligence and normal damages are excluded 

Although property insurance covers most of the damages to your home and possessions from sudden, unfortunate incidents, it excludes those caused by the negligence of the owner or the tenant, or through normal wear and tear. Let’s give an example to understand this better. Suppose, you don’t cut the branches of a big tree in your backyard, and during a storm, it falls on the roof and damages it. You may raise a claim, but if the insurance agency records that you’re somehow to blame for the incident, they may not accept your claim. The homeowners’ insurance also doesn’t cover for things that have worn out over time, like an expensive old carpet or furniture. If you aren’t aware of these subtle nuances of insurance, you may not find alternatives to protect your belongings. 

The limitations of liability insurance

The liability insurance in the homeowners’ policy also has its limitations, which most homeowners aren’t aware of, unfortunately. If you possess hazardous things that have a greater chance of causing injuries on your property, like trampolines, diving boards, tree houses, etc. the insurance agency may not take responsibility for the same. This apart, you may also need to sign a specific ‘exclusion’ deal while buying the homeowners’ coverage to prevent any chances of miscommunication. Sometimes, the insurer may even refuse to give you the homeowners’ coverage, if the stakes are too high. You may either need to purchase a rider or remove the item altogether. 

The trouble with pets

If you have aggressive pets, you may need to abandon them (gasp!) to get homeowners’ insurance. This is the most difficult decision for pet owners, who love their pets like their children. It goes against your need to secure your family’s future. Insurance companies are unlikely to be ready to bear the expenses of injuries caused by the aggressive pet. Is there an alternative? Well, you can always talk to your insurer about dog-specific liability coverages and ask them if they have any. 

Securing precious items

If you’re in the possession of precious items, like jewelry, precious stones, rare paintings, firearms, or souvenirs, it can be difficult to protect them, as the standard homeowners’ insurance won’t cover them. You should then ask your insurer about special coverages for such high-value items under the homeowners’ policy or a separate insurance product. 

Do you see how difficult it can get for homeowners to secure all their belongings? Now consider how much more complex the situation could get for owners of commercial buildings who would have multiple tenants and much greater scale to deal with.

The fact is, such trials are tribulations are unknown to most insurance agencies and that’s why they tend to have standard policies in place.

If you’re wondering what you can do, well, you should do your research properly and find agencies that are ready to help in such tricky situations by providing effective suggestions and products that meet the specific requirements of their clients. Talk to them about the challenges you face, and gauge if they understand the issues. Although it can be difficult to find a perfect solution, an agency with the right kind of experience will often have many of the right answers.