Surprising things homeowners insurance does (and doesn’t) cover.

As a homeowner, one of the most important documents you need to understand is your homeowners insurance policy. When you understand your policy, you’re in a better position to protect your finances. While coverages vary from company to company, below are things that are — and aren’t — covered by homeowners insurance policies.

Water damage

Homeowners insurance is very specific when it comes to what’s covered when it comes to water damage. For example, if your floor is damaged by a water heater leak, stay up to date on signs of water failure, you’re usually covered. However, if water damage is a result of flood waters from a lake, river or clogged street drains, it’s likely that you will not be covered. In order to be covered from external flooding damage you would need to purchase special flood coverage.

Sewer backups

Like flooding, loss due to sewer damage is often excluded from homeowners policies. If you want this coverage, you need to request it and pay an additional premium.

Expensive art, jewelry, cash and collectibles

Homeowners insurance typically caps how much they will pay out for valuables. For example, a ring valued at $7,500 that is lost to theft or fire may only receive $1,500 in covered value. The same goes for expensive art, cash and collectibles. If you want to cover the full value of items such as these you need to purchase additional coverage.

Also, cash coverage is often capped even lower. Money in a Consumers savings account is federally insured by the NCUA up to $250,000.

A child’s belongings at college

A child who heads off to college with a laptop, gaming system, clothing, athletic gear and a bike could easily have property worth $10,000 or more. Many homeowners policies cover your student’s belongings when they live on-campus. For off-campus housing, you may need renters insurance to cover a student’s property.

While you travel or move

Items you take on trips are usually covered by your homeowners insurance.

If you’re moving and take the DIY approach, your goods are most likely covered because your things remain in your possession. However, if you employ movers or a storage container that someone else moves, it’s not likely that your goods are covered during transit. In that case, you would need to purchase insurance from the service provider.

These are just some of the things that homeowners insurance does and doesn’t cover. Read your policy thoroughly to be sure of your coverage. If you don’t understand the written terms of the coverage, call your insurance agent and ask them to go over your policy with you.

Consumers helps more than 2,000 members finance land, first and second homes, and home improvement projects each year. We’d love to help you with a mortgage or home equity line of credit; contact us online or call us at 800-991-2221.

Consumers helps more than 2,000 members finance land, first and second homes, and home improvement projects each year. We’d love to help you with a mortgage or home equity line of credit; contact us online or call us at 800-991-2221.