Disasters Not Covered by Home Insurance

Homeowners Insurance covers an array of risks and exposures.  Even some things that seem unrealistic, like riots or volcanic eruption, fall under the category of covered perils.  However, some events people associate with natural disasters, insurance companies exclude.  Dolack Insurance would like to pass along a few endorsements available to protect against these calamities, and a few risks insurance will not touch whatsoever.

1. FLOODS

Standard homeowners and renters insurance policies exclude flood damage. Flood coverage, however, is available in the form of a separate policy both from the National Flood Insurance Program and a few private insurers.  Replacement cost coverage is available for the structure, but only actual cash value (cost minus depreciation) is available for possessions. There may also be coverage limits for furniture and other possessions stored in the basement.  Also, consider buying coverage if melting snow, an overflowing creek, or water running down a steep hill would cause a flood.  DO NOT wait until the news announces a flood season warning to buy a policy; there is a 30-day waiting period before federal flood coverage takes effect.  Even on the coast, this will protect against Tsunamis.

2. SEWER BACK-UP

Sewer backups, or the inability of sump pumps to handle runoff water from major downpours, are not covered under a typical home insurance policy, nor are they covered by flood insurance. Back-up coverage must be added as an endorsement to homeowners insurance.  Typically, homes with basements are at risk for back-ups and are not necessary for homes with crawlspaces or slab foundations. Coverage is available from most insurers for a nominal cost, usually an additional annual premium of $40-$50.

3. EARTHQUAKES

Earthquake coverage can be a separate policy or an endorsement to your homeowners or renters insurance policy and is available from most insurance companies. In earthquake prone states like California, the policy comes with a high deductible.  This is calculated by how close the property is to a fault line.  Take, for example, the New Madrid fault.  The 150-mile long fault system extends into five states near the Western Kentucky border. Deductibles vary by company, but in places like Murray and Paducah, only a 25% deductible is available (25% of the cost to replace the home) While farther away in Louisville deductibles dip as low as 10%.

4. EVENTS INSURANCE EXCLUDES INDEFINITELY

Some events are so rare, cataclysmic, or hard to insure that insurance companies have no way to afford offering coverage.  These events are nuclear explosion, war, landslides, and mudslides.  Anyone of these would bankrupt an insurance company, so insurance companies wisely choose to withhold coverage.  The same could be said for earthquakes or floods on a massive scale and why insurance companies charge high deductibles or on occasion leave it to the government and FEMA.

  

Thank you for the reading our blog.  To learn more insurance tips check out our website, DolackInsurance.com or call us at 502-333-0577 for an Insurance Quote or Free Consultation.

When Should I Report A Home Insurance Claim?

The unfortunate happens.  It could be a hole in the wall, a tree limb falling on your house, or some strong wind tearing off a few shingles.  Everyone always asks me, “Should I file an Insurance Claim?”  Knowing when to turn in a claim can be one of the hardest questions to ask, but also one of the easiest to answer.

Understand that all insurance companies manage risk.  The more claims made on a property or house, insurance becomes that much more expensive.  To keep premiums at an affordable level, Dolack Insurance recommends higher deductibles to manage the number of claims one makes.  Lower deductibles are available but most companies surcharge for these luxuries.

When the need to file an insurance claim arises, for anyone, not just our Louisville, KY insurance clients, follow these steps:

Step 1:  Immediately notify your insurance company of the loss if you can’t afford to fix it yourself.  

Step 2:  Document everything, from cracks to leaks, to damaged panels and missing shingles.  Insurance companies will send out an adjuster to do the same and catch the stuff you may overlook.

Step 3:  Inventory all damaged, destroyed, or stolen property.  This list will be invaluable when you start to piece your life together.

Step 4:  Start making minor repairs yourself, such as covering broken windows, but leave major damage for the adjuster to make note of later.

Step 5:  Keep in touch with your insurance company.  They will give you a reference number for your claim along with the phone number of your claim advocate.  Never lose these.

We hope this helps. Dolack Insurance can assist you in deciphering these issues and make sure you have the right protection for your lifestyle.  Give us a call or contact us for a Free Consultation or an Insurance Quote.

Avoid These Five Insurance Blunders and Save Money

Reducing coverage or dropping important endorsements can leave you dangerously under insured in the event of a disaster.  Nevertheless, we are all concerned with saving money and it is important to shop around when looking for insurance.  The following are the five biggest auto, renters, flood and home insurance mistakes consumers make while in the pursuit of lower prices, courtesy of Dolack Insurance.

1.  Insuring a home for its market value rather than the cost of rebuilding.

When real estate prices go down, some homeowners may think they can reduce the amount of insurance. However, homeowners insurance covers the cost to rebuild the home brick by brick, not the sale price of the house.  Make sure there is enough coverage to completely rebuild the home and replace valuables.

 2.  Selecting an insurance company by price alone.  

It is important to choose a company with competitive prices, but also one that is financially sound and provides good customer service.  Also, inquire into the financial health of a company and ask friends or family for recommendations.

 3.  Only purchasing the legally required amount of liability on cars.

In today’s litigious society, buying only the minimum amount of liability means you are likely to pay more out-of-pocket if you are sued—and those costs may be steep.   The insurance industry and consumer groups generally recommend a minimum of $100,000 bodily injury protection per person and $300,000 per accident just to be safe.  Also, consider dropping collision and/or comprehensive coverage on older cars worth less than $1,000 to save money.

4.  Dropping flood insurance.

Homeowners and renters insurance do not cover flood damage.  Coverage is available from the National Flood Insurance Program (NFIP), as well as from some private insurance companies.  Before purchasing a home, check with the NFIP to determine whether the property resides in a flood zone; if so, consider a less risky area.  If you're already living in a designated flood zone, look up mitigation efforts to reduce flood damage risk and purchase flood insurance just in case. For more information, visit www.floodsmart.gov.

 5.  Neglecting to buy renters insurance.

Imagine turning your apartment upside-down and shaking it.  Whatever falls out renters insurance covers.  Along with covering your possessions, it provides additional living expenses should you need to move out due to an insured disaster, such as a fire or hurricane.  Equally important, it provides liability protection if someone injures themselves in your home and decides to sue.

These quick fixes seem like an easy way to save money.  But, to quote Dumbledore from the Harry Potter series; “Sometimes we have to make a choice between what is right and what is easy.”  What the wizard is trying to say is don’t cut corners.  Under insuring is a mistake made only once, and the repercussions can last a lifetime.

Thank you for the gift of your time and the opportunity to serve you. Give us a call (502) 333-0577 or Contact Us for a Free Consultation or Insurance Quote.

Always Wear a Seat Belt

Look closely.  Notice the imprint of someone's smudged face who didn't wear their seat-belt on the back of the headrest?  Painful way to learn a simple lesson.  Not only do you wear a belt for your safety, but for the safety of others in the car. In a wreck, bodies become a projectile.  There have been accidents where a body tossed about in the car was the cause of death of other passengers via blunt force trauma.  Meaning, the full 100-300 lbs that you weigh striking others in the head, neck, or chest at the speed of the crash impact, plus more speed if it was a head on collision, can injure and kill.  

We at Dolack Insurance encourage wearing seat belts whenever riding in an automobile.  While car insurance companies don’t offer discounts for wearing one, any medical claim made to auto insurance companies after an accident may not be as serious.  When I was growing up, my mother told me the car would not start unless I was buckled in tight.  This harmless white lie became a habit and saved my life after being run off the road by a reckless driver.  However uncomfortable seat-belts may be at times, casts and neck braces are infinitely more agonizing.

Thank you for the gift of your time and the opportunity to serve you.  Give us a call or contact us for a Free Consultation or for an Insurance Quote.