There are certain types of insurance that you need to purchase because it is required by law, like health insurance, car insurance, worker’s compensation insurance (if you have a business with employees), and malpractice insurance (if you are a medical professional). Many other insurance policies are optional.
So, if other types of insurance are not legally required, then are they necessary? Experts would argue, yes, certain insurance policies are important to purchase. Would you own a home and not have homeowner’s insurance? Probably not considering the risks involved like poor weather, home mishaps, and theft. Other important types of insurance may not be as obvious. This article will highlight the top 7 items you probably don’t have insured.
1. Your Home Against Natural Disasters
If you are thinking about owning your own home, you have likely spoken with your independent insurance agent about homeowners insurance. It can be confusing to understand what is covered under a standard policy.
Homeowners insurance can be broken down into categories, including property damage, additional living expenses, personal liability, and medical payments. If your home experiences damage due to a hailstorm, fire, high winds, or water, then the insurance company will review the loss to determine if it is covered by your insurance. A flooded basement due to a faulty washing machine will probably be covered, but issues caused by a nearby overflowing river will not. If your home is damaged and it is necessary for you to find a temporary residence while repairs are made, then your insurance will help to cover the costs.
One of the biggest risks that is not covered by your homeowners insurance are natural disasters like flooding, hurricanes, and earthquakes..
Flood insurance is not just for homeowners living on the east or west coast. Flooding can happen because of fast-melting snow, rising rivers due to heavy rain, hurricanes, and severe storms. In fact, 25 percent of all flood claims occur in an area of the country that has a historically low risk for flood problems. Flood insurance will cover your personal property—both the home itself and its contents. And, the cost isn’t as high as you might think: you can find plans with annual premiums as low as $129.
Hurricanes are a major factor in flood risks to your home. Flood insurance protects against water that flows into your home from outside. So, if a hurricane raises the sea or river levels causing water to leak into your house, then flood insurance will cover it. Strong winds associated with hurricanes can also damage your home. You will need to check with your insurance agent about the clause in your policy that covers wind damage to determine the policy limits.
Like some flooding events, standard homeowners insurance will not cover you in an earthquake. Earthquake insurance can be purchased as a separate policy or as an endorsement to your current homeowners insurance. It will cover damage to your home and its contents in the event of an earthquake. Depending upon the policy, you may also have additional living expenses covered.
2. Your Jewelry, Antiques, and Art
If you own an engagement ring, wedding ring, or any other expensive pieces of jewelry, then you should review the details of your homeowners insurance or renters insurance policy. The same goes for owners of antiques and art pieces. Sometimes, people assume that all of their personal belongings will be covered, no matter their value. However, this is not the case.
Check with your independent insurance agent to discuss the policy limits for jewelry, antiques, and art. There is a maximum coverage amount for each item and the total. The average protection for jewelry is between $1,000 and $5,000. Provide your agent with a professional estimate of each item’s value, a description of the item, and pictures. This will be helpful for estimating what the replacement value for each item might cost in the event that it is lost, stolen, or damaged. It will also determine the amount of additional coverage you will need.
There are two methods for providing additional protection for your most valuable possessions: a rider and a personal articles policy. A rider can be added to your existing homeowners or renters insurance policies. You can insure each item individually, or purchase blanket coverage which would insure every valuable together as a group. This will cover the entire value of the items in the event of a loss.
The other option is a personal articles policy. This is purchased separately through your insurance agent and is designed to cover your valuable items only. Be aware that for a rider and a personal articles policy, items that are accidentally lost may not be covered, this will cost extra.
3. Your Smaller Recreational Equipment
Large recreational equipment like an RV, popup camper, yacht, or motorized boat can often cost up to tens of thousands of dollars. With such a huge investment, you likely have insurance to protect the equipment in case of damage, accidents or theft. But, what about your smaller recreation items?
Small boats, snowmobiles, and personal watercrafts like jet skis and water scooters are items that you may have left uninsured. However, these are an investment that should be protected.
Whether it’s a rowboat, small fishing boat, or canoe, it is important to have insurance. Depending upon your homeowners policy, you may have coverage for a boat valued under $10,000. Another option is boat insurance. Having a boat, no matter how small, means having coverage for potential damages, bodily injury to passengers, loss of your personal items on board, and against liabilities.
The costs for a boat insurance policy depends upon the size and features of the watercraft. For example, a boat that has smaller dimensions, has an outboard motor, and/or cost less that $30,000 when new, will be significantly cheaper to insure.
If you live in certain states, snowmobile insurance may be required. This type of coverage is similar to personal automobile insurance. The basics will include protection against injuries and property damage to a third party’s buildings, vehicles, and snowmobiles. You can also extend your coverage to include protection against uninsured/underinsured motorists, collisions, theft, and custom parts and accessories.
Personal watercrafts like jet skis and water scooters should also be protected. Most states do not require insurance, but there are several types of coverage you should consider. As with snowmobiles and cars, you have options. Liability insurance protects people and property against accidents caused by your personal watercraft. Collision and comprehensive insurance will help to cover repairs or replacement of your own personal watercraft if it is damaged in an accident or vandalized. You can also get on-water towing and repair, should you break down in the water. Depending upon your boat insurance, you can add your personal watercraft to your existing policy with a rider.
4. Your Trailer
People own trailers for many different reasons like hauling their camper, boat, recreational equipment, livestock, or cars. There are also flatbed trailers for heavy equipment, enclosed cargo trailers for items that need extra protection, and food trailers for individuals who own food trucks. No matter what you are hauling, consider purchasing trailer insurance.
Trailer insurance may not be required, depending upon your state and the nature of your trailer use. You might already have some coverage and don’t even know it. Check with your independent insurance agent to see if your automobile insurance includes your trailer under your liability policy. Otherwise, it may be possible to add it to your existing coverage. Even under your car insurance, there is no protection for your trailer in the event of vandalism or theft. The trailer will only be covered by your auto insurance when it is attached to your car and being towed from one location to another.
If you own a home, then your trailer is likely covered against property damage. The amount covered equals 10% of the value of your home or a maximum of $1,500. It does not include liability coverage.
If you own a boat, your boat insurance may have enough coverage to include your trailer as well. However, it is best to speak with the independent insurance agent to be certain.
Another option is purchasing a separate trailer insurance policy. The insurance agent will ask you about the dimensions of your trailer, the original purchase price, the model and serial number, and the trailer’s purpose. Like snowmobile and personal watercraft insurance, you can choose a policy that best suits your needs and risks, including property damage, comprehensive, liability, and collision coverage.
5. Your Wedding
As wedding costs skyrocket, wedding insurance is becoming increasingly popular. Did you know that in 2014, the average cost for a wedding was over $28,000 in the United States? In some areas of the country, it can be even higher: $70,000 in Manhattan! There are two basic types of wedding insurance that can help protect the investments you’ve made to create a memorable day: cancellation insurance and legal liability insurance.
Wedding cancellation insurance will help you to recover the deposits given to vendors prior to the event in the case of a sudden illness or death, inclement weather, call to active military duty, vendor bankruptcy, or accident. Of course, certain incidents are not covered, like a change of heart by the bride or groom, a minor rainstorm, or issues that are within the control of the policyholders.
Wedding legal liability insurance protects the bride and groom against costs incurred due to property damage, personal injury, and bodily injury. If your guests get food poisoning, someone injures themselves on the dance floor, or a fight breaks out and the tables and chairs get damaged, then liability insurance will help to pay for the medical expenses and the defense costs if you are named in a lawsuit.
If you are interested in additional protection, you can speak to your insurance agent about creating a specialized policy for the wedding dress and rings, host liquor liability, the wedding gifts, rented property, or insurance for a destination wedding.
6. Your Home Improvements or Additions
If you’ve lived in your home long enough, you’ve probably started thinking of ways to improve the look or structure of your house. Maybe you want to build an addition, or maybe you moved into a fixer-upper and want to make changes right away. Regardless, you need to reassess your homeowners insurance.
According to Don Griffin, a vice president for Property Casualty Insurers Association, “A renovation may affect the value of your home or the liability issues. Anything that changes the structure or use of the property can change your policy.”
Your home value probably increased due to the improvements or additions. If an incident should occur, like weather damage, personal injury, or theft, then you will want to ensure that all of your losses are covered.
Certain improvements can actually lower your monthly premium, like getting a new roof. Having a better layer of protection between the inside of your home and the wind, rain, and snow is seen as beneficial by insurance companies. However, putting a pool in your backyard can increase the risk of accidents and injuries on your property, and your premiums will be higher.
If you plan to make improvements to your home, be sure to document the work you have done and make copies of any receipts, permits, and warrantees. Also, take pictures of the area of your home before and after the work is done. Bring this information to your insurance agent so that they can determine if and how your homeowners insurance should be modified.
7. Your Older Self: Long-Term Care
Whether you’re nearing retirement or just starting your first full-time job, you need to consider your future financial well being. Part of any great retirement plan involves purchasing long-term care insurance.
Long-term care insurance helps to pay for stays in nursing homes, assisted living facilities, assistance with the basic activities of daily living, and home care. While the benefits and benefit period may vary based on each policy, one thing is certain: the sooner you buy, the cheaper your premiums will be.
Most people wait until they are close to retirement before considering long-term care. However, Medicare has limited long-term care benefits. In addition, your insurance premiums will be much lower if you purchase a policy earlier in life. But no matter when you buy, it will be very helpful in the long run. Once you need elder care, the costs out of pocket are very high: $248 per day for a private nursing home room at the current rate. If you need assistance for several years, the costs can be astronomical. With long-term care insurance, much of these costs are covered.
Contact Your Agent
Speak with your independent insurance agent today about these and other possible items that you have not yet insured. They will have the knowledge and experience to recommend the right insurance products for you. Once you have purchased a policy, your agent can also walk you through the claims process if you have experienced a loss.
For more information about making an insurance claim, check out these articles:
While the majority of people want an agent involved in their purchase of insurance, many people want to see if they can save money by buying direct from the insurance company. Others want to try a direct quote to make sure the premium they’re now paying through their local agent is fair. If you want a quote for your coverage, click on the competitive quote button on the right side of this page.