What does home insurance not cover? Well, if you have a named perils home insurance policy, you know exactly what’s covered. Typically, insurance will kick in if damage to your home is by an insured peril, such as fire, lightning, theft, and other major hazards specifically mentioned in your policy.
If damages are due to anything else, you’re on your own. If you have an all-risk policy, on the other hand, there is coverage for all damage, except those your insurer will specifically mention. While comprehensive coverage can be reassuring, there are several hazards that are routinely excluded.
If an earthquake or landslide hits, your standard home insurance won’t respond to damage caused by the earth’s movements. You can, however, add earthquake coverage to your policy, and depending on where you live, it may be a good idea. Research from the Insurance Bureau of Canada finds there’s a 30% chance an earthquake will cause significant damage to Vancouver, Victoria and other parts of southwestern British Columbia in the next 50 years, and a 5% to 15% chance a quake will seriously damage Ottawa, Montreal, Quebec City, and the St. Lawrence Valley and Ottawa Valley regions. But also note that if a quake triggers a gas main to break, which then causes a fire that destroys your home, a standard policy will kick in.
2. Frozen pipes
If your pipes freeze and burst, you have coverage. If you’re vacationing in winter, however, your insurance policy may not cover the water damage. That’s because insurers mandate that during the winter, homeowners can’t leave their homes unattended for more than 4 days at a time without losing eligibility for coverage for burst pipes. That’s waived, however, if you get a responsible person to check on the property every day. It’s also a good idea to have someone check your mailbox, shovel your sidewalk, and clear the snow around your home to prevent potential thieves from entering your home.
While damage from burst pipes and broken dishwashers is included in standard homeowner’s policies, there are other ways water can damage your home. You can buy additional insurance to cover damage from sewer backups and, depending on whether or not you live in a flood zone, overland water flooding (water from torrential rainfalls and overflowing lakes and rivers). Insurance for tsunami and saltwater damage isn’t available.
To reduce your risk, install a sewer backup valve and waterproofing and weeping tile along the foundation of your home to divert water away.
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4. Vacant properties
Home insurance policies won’t help if damage occurs on a property vacant for 30 days or more. Vacant, however, is different from unoccupied—this exclusion applies when there’s no furniture on the property—so snowbirds off to Florida or families embarking on summer-long road trips are still covered. But if you’re waiting a few months between tenants, the property is vacant, according to your insurer. If so, you may need to buy a vacancy permit. This, however, only covers vandalism and other malicious acts.
It’s a good idea to ask your tenants to buy renters insurance, because if they’re travelling and their unit is flooded, your landlord’s insurance won’t replace their valuables.
5. Poor upkeep
Insurance is there to help in emergencies, not to pick up the pieces when a homeowner gets lazy. So policies won’t respond to claims for water or mold damage if your sink has been leaking for months and you haven’t done anything to fix it. This is also true for termites and other rodent infestations. Simply put, home insurance is not a maintenance plan.
6. Certain valuables
Most insurance policies maximum amounts you can claim for certain valuables, such as cash, art, jewelry, and securities. At The Co-operators, for example, standard homeowners’ insurance limits policyholders to $6,000 coverage for jewelry, watches, gems and furs. But, there’s also a $4,000 limit for any one item. Claims for stolen or damaged cash are capped at $500. If you do have a substantial jewelry collection, for example, you can buy higher limits of coverage.
To estimate your insurance costs, get a home insurance quote.