Homeowners insurance protects your property from a variety of common risks and events. You will often see these incidents referred to as perils—a term that refers to an event that causes property damage or other losses.
Your homeowner’s insurance policy declares what perils you are and are not protected against—which are referred to as covered perils and exclusions, respectively. Understanding what counts as a covered peril under your insurance policy is essential, as it will help you better prepare yourself for the future in case you ever need to make a claim. Here’s a closer look at five types of perils commonly covered by homeowner’s insurance policies.
What is a Covered Peril?
A covered peril is any hazard or event that may cause damage to your property and is covered by your homeowner’s insurance policy. If one of these perils does cause losses, your insurance policy will reimburse you a specified amount.
Your insurance policy will also list excluded perils. These are events that may cause damage to your home that are not covered by your insurance policy. Floods, for example, are typically not covered by homeowner’s insurance, and as such, many homeowners purchase flood insurance to protect against this peril.
Open Perils vs. Named Peril Insurance Policies
To understand what your insurance policy covers, it’s important to first understand the difference between open perils policies and named perils policies.
- Open perils policies cover all risks and will list any exclusions. These policies typically offer more comprehensive coverage but are generally more expensive than named perils policies as a result.
- Named perils policies only cover any risks that are listed in the policy. Compared to open perils policies, they typically protect homeowners against fewer risks but offer cheaper premiums in exchange.
If cost isn’t a concern and you want to protect your home from as many hazards as possible, an open perils policy is likely to be your best option.
5 Types of Common Covered Perils
Your homeowners insurance declaration page lists all of the perils covered by your insurance policy, so be sure to review this page to better understand what you are and are not protected against.
Covered perils may include a variety of common hazards, including fires, lightning, and more. Here are five types of common covered perils found in most homeowners insurance policies.
- Fire. This includes coverage for direct damage caused by hostile fires. Hostile fires are fires that burn in areas that are not intended to burn. This also typically includes any damage caused by smoke.
- Windstorms & Hail. This common coverage includes damage caused by windstorms, hail, cyclones, tornadoes, and hurricanes. This also generally covers water damage caused by storms and protects both the inside and outside of your property.
- Lightning. Most homeowner’s insurance policies cover property damage caused by lightning. For example, if lightning strikes a tree, causing it to fall over and damage your home, home insurance will help cover expenses related to removing the tree and repairing your home. This also includes coverage for fires caused by lightning.
- Vandalism & Theft. This coverage helps cover expenses if someone breaks into your home and steals your property. Insurance policies typically have different coverage limits for different types of valuables. Homeowner insurance also typically covers damages caused by acts of vandalism.
- Water & Sewer. While flood damage is typically not covered, water damage caused by broken pipes for sewer backups is often covered by home insurance policies. For covered perils, most homeowner’s insurance policies will pay for your additional living expenses while your home is being repaired in the event that it becomes uninhabitable.
What Types of Perils are Not Covered?
There are several perils that are typically not covered by homeowner’s insurance policies. These will usually be listed on your policy’s declaration page as exclusions.
Types of perils that are not usually covered include:
- Lack of maintenance
If your policy does not cover certain perils, you may be able to purchase endorsements to gain more comprehensive coverage. Flood insurance and earthquake endorsements are two of the most common supplemental coverages but may not be necessary depending on the location of your home.
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Understanding what your home insurance policy does and does not cover makes it easier to prepare for the future by determining what additional endorsements and insurance policies you may need to purchase.
At KSA Insurance, we work with homeowners in South Carolina and across the southeastern United States to help them find affordable insurance policies that protect themselves, their families, and their property from a wide range of hazards.
Contact us today to request a quote and learn more about our offerings.