Flood and windstorm insurance is separate from homeowner's insurance and has its own deductibles. | Pixabay
Making a point of checking what insurance polices cover is important, but it could also surprise homeowners to learn just what is covered.
The assignment of benefits (AOB) law intends to control litigation from claims filed by third parties such as contractors, according to the South Florida Sun Sentinel. It does this by making it less beneficial to contractors and plaintiffs’ attorneys to control the litigation, which then in turn means homeowners are paying more for less.
The homeowner can see this if a roof that is as little as 10 years old receives damages from a hailstorm, but the roof my have little to no coverage to be replaced after the storm. Rather than getting a roof replaced, the policy might offer actual cash value – or what the roof is worth today.
“You don’t get a free roof,” Jeff Grady, president and CEO of the Florida Association of Insurance Agents, told the South Florida Sun Sentinel. “The customer has to decide whether to make that claim.”
Non-weather water damage coverage limits were set by most insurers at $10,000 for homes built 30 years ago or more. So if a pipe ruptures in a wall, the water heater bursts and floods the home or an upstairs washing machine leak floods a first floor, the out-of-pocket costs will rise – unless you pay for more coverage, the Boca Raton-based Cronin Insurance Agency told the Sun Sentinel.
According to the South Florida Sun Sentinel, Carriers may set limits unless contractors they select are used.
Analytics firm CoreLogic said 60% of homeowners have insurance that falls 20% short of their home’s value. Working with an insurance agent can help update this coverage, including an endorsement to allow payments higher than coverage limits to meet building codes.
Homeowners can use inflation guard coverage to make limits match price increases automatically and the high costs of rebuilding in a market hit by a disaster like a hurricane can be countered with enhanced replacement coverage.
But keeping track of increases will help make sure homeowners don’t overpay for coverage.
Flood insurance is important for Florida homeowners and is separate from homeowner’s insurance, according to the South Florida Sun Sentinel. Windstorm coverage – sometimes called hurricane coverage – requires a separate deductible.
Choosing a higher deductible to lower the premium, while putting a plan in place can cover that amount.
Parametric insurance can cover this and fences, sheds and pool enclosures that are usually not covered in homeowner’s insurance, the Sun Sentinel reported.
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