Major Disaster 3 Home Insurance may not cover

Many homeowners assume they are protected against disasters if they purchase a home insurance policy that covers their home and personal belongings. And while this is true for most things that can go wrong, there are certain calamities that a standard home insurance policy may not protect you from.

1. Floods

Standard home insurance policies almost always exclude damage caused by natural flooding. This can be confusing, because if a house is flooded from a leak or burst pipe, a problem with the water line to the refrigerator, or a problem with the plumbing, that type of water damage is usually is covered. But if nature causes a flood, insurance usually pays no damage.

Homeowners can purchase separate flood insurance policies, usually from private insurers that offer specialized flood coverage. And homeowners in areas where flooding is particularly likely may be eligible to purchase FEMA flood insurance, sold as part of the National Flood Insurance Program.

However, you must purchase flood insurance before a flood occurs. It is important for homeowners to check their insurance policy for a flood exclusion and, if so, to obtain coverage.

2. Hurricanes

Surprisingly, there is no hurricane insurance. But the most likely effects of a hurricane on a home are flooding and wind damage. Homeowner policies generally exclude damage from hurricane flooding, as it is also nature-caused flooding rather than a broken pipe. Some policies also exclude storm damage.

Homeowners should purchase wind and flood damage protection if they live in a hurricane-prone area and don’t want to be left without coverage in a severe storm. In most hurricane-prone states, it is possible to purchase coverage from private insurers offering windstorm plans, or through a government-administered plan, such as the Texas Windstorm Insurance Association.

3. Forest fires

The fire is also covered by most home insurance policies. However, in areas where the risk of forest fires is high, insurance policies may exclude this protection. In this case, a homeowner would have coverage for certain fires, such as those resulting from a short circuit. But they would not be protected against damage from forest fires.

Again, homeowners can purchase separate insurance coverage for forest fires if their standard policy does not cover such events. Private insurers can offer this protection, as can government-backed insurance pools such as the California FAIR plan.

Homeowners should research their coverage options – government-backed insurance plans are often expensive, and flood, wind, and forest fire policies often have higher deductibles than standard insurance plans. But finding the right coverage is crucial, especially if you live where these risks are greatest.


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