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Homeowners Insurance Floaters and Endorsements

What is a Homeowners Insurance?


Homeowners Insurance is an insurance policy that you buy from an insurance provider which helps protect your home and family from unexpected events or disasters. It generally provides coverage to both your interior and exterior parts of your home. Though it is not mandatory to have Homeowners insurance by law, it is wise to invest in an insurance to protect your home and family and have peace of mind from unexpected events and disasters. If you have a mortgage for your home, then Lenders may require you to have Homeowners Insurance or Hazard Insurance as a mandatory element before closing to provide financial protection against losses or unexpected events.


Endorsements

Endorsements are also called as Riders or Options. Endorsements are additions or alterations to the insurance policy that alters the terms of the original policy. They provide additional coverage for specific perils or items that are sometimes excluded. Endorsements are usually used as a supplement to the homeowners policy. It may be used to cover perils like Flood, Earthquake, Sewer backup, Windstorm, Identity theft and Valuables coverage.


Extended Replacement cost

Extended replacement cost is an endorsement made on the home insurance policy to extend the dwelling limit up to 50%. If the home has a mortgage, the lender might require the coverage limit to be a certain limit. This endorsement extends the dwelling limit coverage over the standard homeowners policy.


Identity Theft

The identity theft coverage helps reimburse the crime victims to restore their identity and cleaning up. Some of the expenses that may be covered in the policy are cost of credit reports, notary fees, legal fees, childcare costs, credit monitoring services.


Water Backup Coverage

If water backs up from sewage or sump pump and damages the foundation of your home, the standard homeowners policy doesn't provide the coverage. This coverage protects the foundation of the home and personal property from the damage caused by the backed up water.


Sinkhole Coverage

Home insurance policies usually does not cover sinkholes or any other earth movement like a mudslide. For added coverage, a standalone sinkhole policy may be purchased.


Flood Coverage

Flooding is the one of the most common disasters recorded across U.S. The losses caused by flooding can be devastating and is not covered by the standard Homeowners or Renters Insurance policy. Just one inch of flooding water can cause damage around $25000. So, it's wise to consider buying Flood Insurance if you think you may be impacted by Flood. Your mortgage lender may require you to buy flood insurance if your home is located in the flood zone or if it is a government backed mortgage like FHA or VA.

Flood insurance policy can be bought as a separate policy and some of the policies have an option to add it as an endorsement for an additional fee. The policy has a period of 30 days to take into effect with few exceptions in scenarios like you need a policy to close or refinance on the property or the area is included recently in the high risk Flood zone in which case there is a waiting period of 1 day if bought within 13 months of the update. You can refer FEMA ( Federal Emergency Management System) maps to locate your home and get an idea of what are the chances of flooding in your area. FEMA coordinates with the federal government to prepare, protect, prevent and provide relief for the natural disaster occurrence.


Earthquake Coverage

Earthquakes can occur anywhere and anytime and it's important to be prepared as an earthquake can cause a huge damage to the foundations of our home and make the home inhabitable. It is important to protect your home and loved ones in times of disaster. It helps protect your money you have invested if an earthquake damages it. If you don't have an earthquake insurance and you experienced earthquake, then you may have to pay for the damages of your home, continue to pay for mortgage and pay for a new place to live in out of your pocket.

It can be added on as an Endorsement in your current Homeowners, condo or renters policy or it can be bought separately depending on the insurance providers. The standard homeowners, condo or renters policy does not cover the damages caused by an Earthquake. If a fire is caused by an earthquake and the fire caused damage to the home, it might be covered in certain homeowners, condo or renters policy. Some mobile homeowners policy may include the coverage for the damage caused by earth movement.



Watercraft

The coverage includes any watercraft such as boat, ship etc. It protects against the damages caused while boating or docked. It also offers liability protection


Equipment Breakdown Coverage

Equipment breakdown coverage covers the breakdown of appliances or damage caused by a covered peril such as fire. But, the coverage does not pay to repair or replace them if they break due to electrical or mechanical failures. Some examples are heating and air conditioning systems,


Builder's Risk

Builder's risk is also known as new home construction replacement, which covers the building and the construction materials while the property is under the construction.


Personal Injury

Personal injury endorsement adds a liability protection to your policy for the things such as wrongful conviction, slander, defamation, legal liabilities which are harmful but doesn't actually cause physical damage to the body.


Floaters

Personal property floaters are similar to endorsements except instead of increasing coverage on certain categories, it increases the coverage on a particular item. Floaters are usually an insurance coverage beyond the regular coverage limit on particular items.


  • Firearm - Typically includes both the antique and modern firearms.

  • Music Instruments - Music instruments such as Guitars, Pianos etc that are meant for personal use are covered, instruments meant for professional use are typically not included.

  • Cameras - Cameras, projectors and any other visual equipment that are meant for the personal use are covered, professional equipment are not covered.

  • Fine Art - Fine arts such as articles, china, collectibles, paintings, sculptures, silverware are covered.

  • Sporting Equipment - Golf, surfing, tennis and other sport equipment that are meant for personal use are covered, professional use are not covered.

  • Collections - Collectibles such as antiques, baseball cards, coins are included in the coverage.

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