WEDNESDAY, JUNE 23, 2021
Over the last 16 months, we have all spent exorbitant amounts of time at home. As the Spring turned to Summer in 2020, many of us spent more time in the backyard and used the savings from not heading out for dinners and vacations or invested stimulus payments to update and expand our outdoor spaces.
Often times these updates are expansive and have significant costs. If your insurance is not addressed and understood appropriately, these backyard updates could be uncovered in a loss. It is important to communicate these upgrades to your insurance agent and feel confident your homeowner’s insurance policy is set up to respond in the case of a loss to your outdoor improvements.
1- What is “Other Structures” or Coverage B?
The standard ISO Homeowners policy will automatically include 10% of the Coverage A (dwelling) limit for “Other Structures”, where a majority of your detached garages and sheds will be covered. So, for example, if my home is insured to $300,000, I will have $30,000 in coverage for “other structures”. It is important to know what else is considered in “other structures”. Guest houses, gazebos, fences, detached areas or patios, and walkways are all also considered “other structures”. It is easy to see how only 10% of your dwelling limit may not be enough in the event of a substantial loss event, like a major weather event, that could impact the entire property.
2- What about the pool??
If there is a pool on the property it needs to be disclosed to the carrier at purchase or renewal of a homeowner’s policy. It is a significant underwriting exposure and not informing your carrier can be a material misrepresentation and grounds to cancel coverage and/or deny a claim.
Having a pool is a major investment to your home and can be very costly if damaged. Your insurance can respond differently in the event of a loss to your pool dependent upon what insurance policy you have and what type of pool you own. In-ground pools are generally covered by the other structures limit; but the portable-style, inflatable above ground pools that are growing in popularity, could be considered personal property. This is important as there can be a different loss valuation and level of coverage depending on your policy.
3- What about landscaping?
4- Your homeowners’ policy will have specific sub-limits for trees, shrubs, bushes, and ONLY under specific perils like fire, lightening, vandalism and theft. Weather related events like wind, hail, and weight of ice and snow may not be a covered loss. It may be possible to increase the covered perils or limits depending on the carrier and type of policy. Your policy will also have a set limit for the costs to remove damaged landscaping from covered property.
With the investment of time and money you have made in your backyard and home you want to be sure it is covered properly. A lot depends on the specifics of your homeowners’ policy, the amount of coverage you have and the endorsements included. It is important to have clear conversations with your agent any time you make any improvements to be sure your coverage will respond properly.
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