Understanding Your Insurance

8/25/2021 (Permalink)

Knowing what your policy covers is the first step in making a disaster "Like it never even happened."

There are many simple actions you can take now to prepare yourself and your property for a disaster. Understanding your insurance needs is an important step to prepare in advance!

Getting the right type and amount of insurance may mean the difference between a quick recovery from disaster and years of financial challenges. Take the following actions now to find and secure the appropriate insurance policies to protect your family's financial health.

Different lines of insurance are available to cover the many types of potential damage caused by a disaster. Homeowners' and renters' insurance policies usually give you the following areas of coverage:

• Dwelling: coverage of your house
• Other Structures: coverage for structures such as garages, decks, and fences
• Personal Property: coverage for items such as furniture, clothing, and appliances
• Loss-of-Use: payments if you need to move temporarily due to covered damage
• Personal Liability: coverage for accidents happening on your property
• Medical Protection: payments for someone who is injured on your property
• Property Damage to Others: coverage if you accidently break or damage someone else's property

Many landlords and property management companies will want to see proof of a renter's insurance when you sign a lease. If you own a business, you will need to purchase business (or commercial) insurance to protect your property and employees.

Manufactured homes, condos, and farms have special insurance policies. Your bank or mortgage lender may also have minimum insurance requirements as a condition of your loan. Always make sure you have enough coverage to rebuild or replace what you lose if a disaster strikes!

What's Covered?

The insurance industry identifies a cause of loss, such as fi re or theft, as a "peril." Insurance only applies when your policy covers the peril that caused the loss. Be sure to check your policy to see which perils it covers, and in what situations. A homeowner's policy may cover different perils for the house and for personal property. Th e policy may also have different deductibles based on the peril.

Always check your individual policy for specific details. For example, basic property insurance policies may not cover losses caused by flooding, wind, earthquakes, terrorism, or pollution.

Flooding is the most common and costly disaster in the U.S.! Talk with your local insurance agent if your property is at risk for flooding or mudflows, including flooding caused by hurricanes or earthquakes. Other flooding impacts, such as mold or mildew damage, can also be covered with basic property insurance, but may have a limited amount of loss payable.

Visit ready.gov for more risk mitigation resources.

*Restoration Newsline Vol 32, Iss 8