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what’s included in a standard homeowners policy?

Owning a home is likely the largest investment you will make. The benefits are many, including stabilizing your housing costs with a fixed mortgage, gaining equity and taking advantage of tax benefits. How can you best protect your investment? Homeowners insurance is designed to do just that.

Unlike car insurance, home insurance isn’t required by law. You can own a home without a homeowners insurance policy, but only if you bought your home outright and are willing to gamble with such a large asset. If you have a mortgage, your lender will most likely require you to have a homeowners policy.

When considering what is covered under a standard homeowners policy, you may have asked yourself questions like, “Do I actually need more coverage than what is included?” or “Do I need extra earthquake or flood coverage?”

We’ll help you understand what is covered, what is not and whether your current policy is comprehensive enough for your situation.

coverage basics

A homeowners insurance policy exists to protect your home against accidental losses. Standard coverage falls under four areas:

Structural coverage pays to rebuild or repair your home due to damage or destruction. It covers damage or destruction due to fire, water and acts of nature, like tornadoes, hurricanes, lightning and hail.
Personal property coverage protects your personal belongings in case your clothes, furniture and other personal items are stolen or destroyed. Expensive items like jewelry, art and collectibles are covered as well, but may have dollar limits.
Liability protection protects you against lawsuits from injury or damage that you or your family cause to other people. If, for example, your child accidentally breaks a neighbor’s antique dishes, your homeowners policy will cover it.
Additional living expenses covers living expenses incurred while you’re living away from home because of damage from a disaster.

Damage resulting from earthquakes, landslides, mudslides and floods is not covered. You’ll need to purchase additional insurance if you live in a flood zone or in an area with frequent earthquakes. If you’re wondering how much structural coverage to purchase, here’s a good general rule: Purchase enough to rebuild your home.

To make sure valuables are covered for their appraised value, consider adding a personal property floater to your policy. Personal belongings coverage extends to items that are stored away from your home too, such as in a storage facility.

Insurance doesn’t include normal wear and tear to your home or to items in your home. For example, if your refrigerator suddenly stops working, water seeps in through a crack in the foundation or your sink begins to leak, you’re responsible for the repairs.

Your liability protection also provides no-fault medical coverage in case a visitor is injured in your home, such as if they twist an ankle on your stairs. If you’re brought to court, liability coverage pays for the cost of defending you in court and any damages you must pay (up to the limit stated in your policy).

what’s not covered

There is a handful of situations other than wear and tear that a standard homeowners policy doesn’t cover, despite the fact that they are somewhat common. These situations include:

Dog bites. Some dog breeds known to be aggressive are completely excluded from coverage. Chances are, your dog won’t be covered by your policy if he or she has bitten someone before, even if not considered an aggressive breed.
Mold. Some insurance companies will add an endorsement for mold coverage, but you must pay for it. The best way to avoid mold issues is to be aware of moisture buildup in the first place.
Pool accidents. A high number of fatalities occur in residential pools, increasing your liability. A policy may include coverage for the pool, but you’ll have to declare it and will likely have to buy additional liability coverage.
Sewer backup. Sewer backups can cause major damage to your home’s floors, walls and electrical systems. If you think this could happen to your home, consider buying extra coverage.

While homeowners insurance is designed to protect your home, it’s important to be prepared for any situation that may arise. Talk with your insurance broker about your current coverage and whether your policy meets all your needs.

homeowners are underinsured: what can you do?

in News and Articles

Did you know millions of homeowners across the United States are underinsured? However, they often don’t know this until it’s too late.

As a homeowner, the consequences of your home being underinsured can be detrimental. Even so, according to Nationwide, about two out of every three homes in America are underinsured; meaning, millions of American homeowners are at risk of significant financial loss should a disaster ever affect their home.

As a homeowner, how can you make sure your property is adequately insured?

Let’s discuss.

underinsurance today

Underinsurance is a nationally recognized problem today—and is only getting worse due to rising inflation and increased building costs.

To illustrate, a study showed that over two-thirds of houses in the 2021 Marshall Fire near Boulder, Colorado, were underinsured from between $98,967 and $242,670 and therefore, deemed total losses.

So, what can you do to avoid being underinsured as a homeowner?

how to avoid underinsurance

Luckily, underinsurance can be prevented. Here are a few tips that homeowners can take to avoid underinsurance.

ensure your policy is updated

Have you completed any home renovation or remodel projects recently? If so, be sure to notify your insurance company. Usually, your coverage will need to be adjusted to adequately protect your home.

In fact, according to the Independent Insurance Agents and Brokers of America, one in four projects increases the value of a home by more than 25%. (Yes, we said 25%!)

PS: And don’t limit these updates to only big projects! You should notify your insurance company if you decide to add a deck, pool, trampoline, woodstove, or even a dog to your family! Doing so can help ensure you won’t pay for damages or injuries from these new features.

avoid home insurance coverage minimums

Lenders require homeowners with mortgages to carry a certain minimum amount of homeowners insurance coverage.

This minimum level of coverage typically sits at about $100,000; however, experts recommend three times this amount. Wow!

evaluate your exclusions and endorsements

Exclusions and endorsements illustrate the parts of your policy that either give or take away coverage.

keep track of your personal property

Homeowners’ policies typically cover a percentage of one’s personal property.

Take inventory of your personal property periodically. If the value of your personal items exceeds your coverage limit, we’d recommend purchasing additional coverage (called an endorsement or rider).

Today, it is so simple to use your cell phone to take an interior home video. Don’t be shy. Open the drawers, cupboards, and closets. Get it all on video.

get in touch with our team at benchmark commercial insurance

These steps are just the tip of the iceberg in terms of ensuring your home is properly insured. It can be difficult and even overwhelming to do this all yourself, which is why our team at benchmark commercial insurance is here to help.

Reach out to our team today to see if your home is underinsured. Then, for business owners, continue reading to find out how to insure your business.

e-bike insurance coverage: what you need to know

in News and Articles

The use of e-bikes has grown immensely over the last few years. In 2019, the industry was estimated to be valued at $15.42 billion, and it has only grown since then—especially with rising gas prices! In fact, experts predict that the e-bike market is expected to reach $54.48 billion by 2027.

So, let’s talk about e-bikes; more specifically, do you need a standalone excess insurance policy for this fun gadget? Let’s find out.

what is an e-bike?

If you’ve been outside at all in the past few years, chances are you’ve seen a large number of e-bikes whiz past you. But what is an e-bike? An e-bike, or electric bike, is a bicycle equipped with battery power motors to aid with pedaling (either partially or completely depending on the bike).

Bosch describes the three categories of electric bikes in the United States:

“Class 1: eBikes that are pedal-assist only, with no throttle, and have a maximum assisted speed of 20 mph.
Class 2: eBikes that also have a maximum speed of 20 mph, but are throttle-assisted.
Class 3: eBikes that are pedal-assist only, with no throttle, and a maximum assisted speed of 28 mph.”

how do I insure my e-bike?

Electric bicycles are becoming increasingly popular as an alternative to traditional pedal bikes. While they offer many of the same benefits as their manual counterparts, e-bikes also come with a few unique considerations when it comes to insurance. Here’s what you need to know about insuring your e-bike.

Most standard bicycle insurance policies will not cover e-bikes, as they are considered a motorized vehicle. However, there are some insurers that offer specialized e-bike insurance policies. These policies will typically cover damages to your e-bike caused by things like theft, vandalism, or accidents.

When shopping for e-bike insurance, be sure to ask about coverage limits and exclusions. Some policies may only cover certain types of e-bikes, or they may exclude coverage for damages caused by riding on rough terrain. Also, be sure to get quotes from several different insurers to compare rates.

E-bike insurance is not required in all states, but it is a good idea to check with your local Department of Motor Vehicles to find out if it is required in your state. Even if it is not required, e-bike insurance can provide peace of mind and protection in the event of an accident or theft.

are e-bikes covered by homeowners insurance?

The short answer? It depends.

E-bike coverage largely depends on your:

State
Insurance company
And claim type

Even if you are covered by your homeowners policy, that coverage is likely capped at a limited dollar amount.

why are e-bikes not covered by most insurance policies?

There are a few reasons for this. First, e-bikes are still a relatively new technology, and insurers may be hesitant to cover them because of the potential for expensive repairs or replacements.

Additionally, e-bikes can be more expensive to insure than traditional bicycles because they’re often used for commuting or other purposes that require higher levels of coverage.

Finally, e-bikes may be considered “high-risk” by some insurers because they can reach higher speeds and pose a greater accident risk than traditional bikes. As a result, e-bike owners may have difficulty finding an insurance policy that meets their needs.

risks associated with e-bikes

There are a few increased risks of injury associated with riding an e-bike that include:

Speed: Because e-bikes can go faster than traditional bikes, riders may be more likely to suffer from road rash or other injuries if they crash.
Weight: E-bikes tend to be heavier than traditional bikes, so riders may be more likely to suffer from musculoskeletal injuries if they fall off or are involved in an accident.
Technology: Since e-bikes have lithium ion batteries, riders may be at risk of electrical shocks if the batteries are damaged.

important things to consider

When it comes to e-bikes and insurance, there are a few important considerations, such as:

1) Whether or not the e-bike is covered by your home insurance policy. If it is not, you may want to consider getting a separate policy that covers the bike.

2) The value of the e-bike. You will want to make sure that the policy you choose covers the full value of the bike.

3) The type of e-bike. There are different types of e-bikes on the market, and each type may be covered differently by insurance policies. For example, some policies may not cover mountain bikes or racing bikes.

4) The use of the e-bike. Some policies may only cover bikes used for leisure, while others may also cover bikes used for commuting or business purposes.

5) The location where the e-bike is kept. Some policies may only cover bikes kept in a secure location, such as a garage, while others may also cover bikes kept in a shed or on a balcony.

6) The age and health of the rider. Some policies may have age limits or exclusions for riders with certain health conditions.

7) The level of cover required. There are different levels of cover available from insurance providers, so you will need to choose the one that best meets your needs.

8) The excess. This is the amount you would need to pay in the event of a claim. It is important to check the excess on any policy you are considering, as it could vary significantly from one insurer to another.

9) The period of cover. Some policies may only cover you for a set period of time, such as 12 months, while others may cover you for the lifetime of the bike.

10) The claims process. It is important to check how an insurer handles claims, as this can vary from one company to another. You will want to make sure that the process is simple and straightforward, and that you will be able to get the support you need if you need to make a claim.

what do we recommend?

We know – the extent to which homeowners policies provide coverage for the physical damage and operations liability to e-bikes is clear as mud.

Owning and operating an e-bike can create additional risk exposure, with limited to no coverage under your homeowners policy.

This is why, at benchmark commercial insurance, we recommend a standalone policy for your e-bike.

Why? Every single insurance carrier has different e-bike parameters. By getting a standalone policy, it reduces the worry about liability if an accident were to occur. Moreover, homeowners policies have exclusions, and are specific to the particular wattage of your e-bike.

Coverage for a standalone policy can be as low as $100 annually; however, the cost of insurance varies for everyone.

Unsure if your homeowners policy covers your e-bike? Get in touch with our professionals at benchmark commercial insurance today. Then, since we’re already speaking of moving vehicles, check out our article on why auto insurance premiums are increasing.