This information was compiled to help consumers answer some of the most frequently asked questions about homeowners insurance. Please note, these are general responses. Additional questions or comments on your specific situation should be made to the Iowa Insurance Division at 1-877-955-1212.
Yes, most homeowners forms contain deductible provisions applicable to losses occurring under Section I (Section I losses include (a) dwelling, (b) appurtenant structure, (c) unscheduled personal property, and (d) additional living expenses. The type and amount of deductible varies by company. Deductible provisions do not apply to Section II losses (Section II losses include personal liability [bodily injury and property damage] and medical payments to others). Some companies offer an optional deductible applicable only to wind or hail losses. Most offer higher deductible options such as $500 or $1,000 at a reduced premium.
Most homeowner policies provide that coverage does not apply to animals, birds, fish, automobiles and business property; for loss or damage caused by flood, surface water, water which backs up through sewers or drains, earth movement, nuclear damage, war, etc. Section II coverages (personal liability and medical payments) do not apply to the operation, ownership, use, etc., of any aircraft, automobile, recreational motor vehicle, water craft powered by more than 50 horsepower motor; bodily injury or physical damage caused by an intentional act of the insured. It must be noted that these are a mere sample of property and perils not covered. A complete review of your policy is the only way to determine what property is covered and what perils are insured against. Also, there are specific limits of coverage on property insured under the homeowner's policy such as money, securities, water craft, theft of jewelry, silverware, and or guns.
Yes. Whether your policy pays for the replacement or just the actual cash value, the company is only obligated to pay for personal property that you can show you owned at the time of loss. It is a very good idea to keep an up to date inventory in a secure place. Also, to help you remember what you had, it is helpful to take pictures of each room and keep them with your inventory.
Most insurance policies exclude water damage for water, which backs up through sewers or drains. You may wish to contact your agent and inquire about putting an endorsement on your policy, which would cover sewer back up.
Almost all auto and homeowners policies exclude coverage for any losses of tapes, disks and other sound transmitting or receiving equipment used in an automobile. Some insurance companies however, will provide coverage for these items for an additional premium. Check with your agent to determine if coverage can be purchased for the stereo, tapes and disks used in your auto.
Theft to watercraft, including furnishings, equipment and outboard motors, are typically excluded if the theft occurs outside your residential premises. To adequately cover your boat and its accessories, you should contact your agent regarding a separate policy covering the boat.
Yes, if the insurance company decides to cancel the policy when your policy renews, the insurance company must send a nonrenewal notice at least 30 days in advance of the effective date of nonrenewal. Unless it is an issue of discrimination, cancellation at the renewal date (also called non-renewal) can be for any reason. If the cancellation is to occur before the policy is scheduled to renew, special reasons must exist such as non-payment of premiums, or discovery of fraud or misrepresentation on the part of the insured.
Your insurance company would first confirm the value of the items with one or more independent antique dealers. You should then be paid a dollar value based on the dealer(s) estimate of the worth of the antique items. If you disagree with the settlement offered by your insurer, then you can follow the dispute resolution process outlined in your policy. There is a simpler way. Get appraisals and have your agent establish the stated values in the policy. You should also keep your appraisals up-to-date.
Generally, your own policy should cover the loss. Your insurance company may be able to recover the amount it pays you for the loss and your deductible from the homeowners insurance that your neighbor may have if the loss occurred as a result of your neighbor's negligence.
Flood coverage is generally excluded on the basic homeowners policy. However, some homeowner's policies provide coverage for backup of sewers and drains that cause flooding in your basement. This coverage can be purchased for a nominal premium. You should check with your agent to see if this coverage is provided and how much it costs.
If, however, you live in a flood-prone area, you should consider and may be required by your lending institution, to purchase a flood insurance policy. Your agent should be able to inform you about the Federal Flood Insurance Plan and the exclusions and limitations of coverage in this policy.
Generally, your policy can be cancelled for these reasons:
• Non-payment of premium;
• Material misrepresentation/Fraud;
• Conviction of a crime arising out of acts increasing the hazard insured against. (For example, conviction for illegal storage of fireworks);
• Discovery of willful or reckless acts or omissions by the insured increasing the hazard insured against. (For example, not getting a gas leak fixed);
• Physical changes in the property insured which result in the property becoming uninsurable. (For example, should the home become vacant for more that 60 consecutive days, a greater exposure to vandalism and damage is assumed to exist); and
• A determination by the Commissioner of Insurance that continuation of the policy would place the insurance company in violation of the law.
The basic homeowner policy usually does not. However, this is a popular coverage for insurance companies to offer and you may be able to buy this coverage for a nominal additional premium. There is also the issue of where the power was lost. Some policies are limited to coverage for electricity lost in the home or where the electricity enters the home. Others will limit coverage to within so many yards from the home. Your agent should be able to tell you about the availability of coverage and how much it would cost.
Source: National Association of Insurance Commissioners, 2009