When it comes to protecting your property, having a solid insurance policy is essential. But what if we told you that some natural events that could damage your property – floods, earthquakes, and sinkholes – are often not covered by standard property insurance? This is a reality that every property owner should be aware of to avoid costly surprises down the road.
Here’s what you need to know about these common but critical coverage gaps and how to protect your property from the unexpected.
What’s Missing from Your Property Insurance Policy?
It’s easy to assume that once you’ve got a property insurance policy, you’re safeguarded against every possible disaster. Unfortunately, that’s not the case. Standard property insurance often names “perils” for coverage and will exclude the following risks:
1. Floods
Flooding can occur from extreme weather events or even a water control malfunction in your area. Yet, damage caused by floods is typically excluded from property insurance policies. If your property is located in a flood-prone area, this poses an even greater risk.
- Key Tip: Check what flood zone your property falls in by consulting local government resources and/or FEMA maps.
- Solution: Consider purchasing a flood insurance policy, either as an endorsement to your property policy, through standalone “private” flood insurance, or through the National Flood Insurance Program (NFIP). This coverage can protect you from financial devastation if your property is inundated.
2. Earthquakes
While earthquakes might not seem like an everyday concern, damage caused by seismic activity is not covered under the vast majority of standard property insurance policies. Even minor tremors could lead to costly structural repairs.
- Key Tip: If you live in or own property in an region with a fault line or in an earthquake-prone area, review your vulnerability carefully.
- Solution: Purchase a standalone earthquake insurance policy or add an earthquake endorsement to your current policy. Be aware that earthquake insurance deductibles are calculated as a percentage of your coverage rather than a fixed dollar amount, so review this closely before purchasing.
3. Sinkholes
Sinkholes might seem like a rare occurrence, but they can have catastrophic effects if they occur beneath your property. Most standard property insurance policies exclude coverage for sinkhole damage.
- Key Tip: Research whether your area is susceptible to sinkholes by consulting geological surveys or local zoning information.
- Solution: Opt for specific coverage for sinkholes by exploring endorsements or policies tailored to this risk.
What Can You Do to Protect Yourself?
To safeguard your property and financial stability, it’s crucial to take proactive measures:
Review Your Insurance Policy
Start by reading through your existing property insurance policy in detail. Identify the exclusions to understand where your coverage gaps lie.
- Assess Your Property’s Risk
- Use local resources, such as flood zone maps, seismic activity probabilities, and geological surveys, to evaluate the likelihood of floods, earthquakes, or sinkholes affecting your property.
- Speak to an Agent
- Insurance policies can be complex, especially when navigating specialized endorsements or standalone coverage. Contact an experienced insurance professional who can walk you through the process and recommend the best options tailored to your property’s unique needs.
Get Information on Your Options
These exclusions don’t have to leave you vulnerable. With the right endorsements or standalone policies, you can ensure that your property is comprehensively covered against risks like floods, earthquakes, and sinkholes.
Reach out to Brandon Patterson on our team today at brandon@ownbyinsurance.com and discuss your options today.