6 Areas Where Your Homeowner Customers May Not Be Covered
Polar vortexes, spring flooding, summer heat waves and tornadoes, hurricanes, earthquakes — does it ever end?
Throughout the year, it seems like the homeowner’s house is always in jeopardy. While having insurance can’t make up for the turmoil of losing one’s home to one of these disasters, it can certainly provide the extra help needed to get individuals and families back on their feet.
Unfortunately, many insurance buyers fail to take a hands-on approach when it comes to knowing the difference between what their standard policy covers and where extra coverage is needed.
As your customers face down more winter storms and other natural disasters in 2014, make sure you’re keeping them informed about these other vital coverages that operate outside of a basic policy.
Purchasing an endorsement against sewage backup or sump pump failure can be a good idea and highly affordable, usually totaling around $50 per year. Considering the significant damage that a single inch of water does to a home — Consumer Reports estimates it at $20,000 — this is a coverage that one may wish to consider as part of their insurance portfolio. http://yhoo.it/LIgNVu
Standard policies do not pick up damage caused by flooding, but luckily for homeowners, there are protections. Consumers can purchase flood insurance through the federally sponsored National Flood Insurance Program. High risk areas generally require this coverage from the homeowner, though it’s probably a good idea to purchase a policy regardless, as premiums in low- and moderate-risk areas are quite reasonable. http://www.floodsmart.gov/floodsmart/
California is typically thought of as Earthquake Central, but ‘quakes in Virginia, along the East Coast, and even in Arkansas, have negated the theory that “as long as you don’t live in Cali you’re safe.” A standard homeowner’s policy will not include earthquake protection, so it’s important that consumers are aware of this when purchasing coverage for their home. While areas like California may cost more due to their high susceptibility to such disasters, it’s pretty clear that earthquakes can affect multiple locations throughout the US.
Areas like Hawaii, the District of Columbia, Maine, Texas, and the Atlantic and Gulf coasts, may have higher hurricane deductibles that supersede the standard deductible. These deductibles are often estimated between one and five percent of the insured value (a $500,000-insured home could be anywhere from $5,000 to $25,000 out-of-pocket).
Babysitters and yard-mowers — these casual types of employees will probably be covered on the standard homeowner’s policy. It’s when the homeowner employs plumbers, contractors, gardeners, or home health aides, that they should consider additional coverages. Also, if they choose not to purchase worker’s compensation insurance for more permanent part- and full- time positions, then they should be made aware of contractors who claim to be “licensed and insured.” Advise clients to check for proof ahead of time, and the day-of, to ensure the contractor has not allowed his policy to lapse before beginning work.
“Floater” endorsements can be advisable for things like expensive antique furniture, jewelry, silverware, furs, artwork, coin collections or baseball memorabilia. These endorsements can cover the full value in the event the objects are destroyed, lost, or stolen.
There’s a reason most insurance customers still prefer buying from a flesh-and-blood agent rather than going it alone. The marketplace for coverage can be overwhelming to the non-trained eye, and most customers depend on their agent to do more than simply handle their policy. They’re also looking for advice and peace of mind in good times and bad. The agent able to offer such assurances will have a bright future no matter how much the market changes in the years to come.