Unique Facts About Home Insurance That Most People Don’t Know

Home insurance is a vital financial tool that protects homeowners from unexpected damages, losses, and liabilities. While most people understand the basic coverage, there are many lesser-known aspects of home insurance that could benefit policyholders. This guide explores unique facts about home insurance that most people are unaware of, helping you maximize your coverage and make informed decisions.

1. Home Insurance Covers More Than Just the House

Many assume home insurance only covers the physical structure, but policies often extend to:

Personal belongings, even when they are outside the home (e.g., stolen luggage while traveling).
Liability coverage for incidents occurring away from home, such as a dog bite at a park.
Additional structures on the property, such as detached garages, sheds, and fences.

2. Some Disasters Are Not Automatically Covered

Standard home insurance policies do not cover all natural disasters. Common exclusions include:

Flood damage (requires separate flood insurance, often through the National Flood Insurance Program).
Earthquake damage (requires an additional policy or endorsement in high-risk areas).
Sewer backups (may require an additional rider or coverage add-on).

3. Home Insurance May Cover Identity Theft

Some insurers offer identity theft protection as an add-on to home insurance policies. This can cover legal fees, lost wages, and expenses related to restoring your identity.

4. Your Credit Score Can Affect Your Premium

Insurance companies use credit-based insurance scores to determine premiums. A lower credit score may result in higher premiums, while a good credit score can lead to discounts.

5. You Might Be Covered for Meteorite or Space Debris Damage

Most standard home insurance policies include coverage for "falling objects," which means if a meteorite, asteroid, or space debris damages your home, your insurer will likely cover the repair costs.

6. You Can Get Discounts for Home Improvements

Home upgrades that improve security and reduce risk can lower premiums. Discounts may be available for:

Installing a security system or smart home monitoring devices.
Upgrading the roof with impact-resistant materials.
Adding storm shutters in hurricane-prone areas.

7. College Students May Be Covered Under Their Parents’ Policy

If a student lives in a dorm, their belongings may still be covered under their parents' homeowners policy. However, if they live off-campus, a renter’s insurance policy may be necessary.

8. Home Insurance Can Cover Spoiled Food

If a power outage causes food spoilage, some policies provide reimbursement for lost groceries. However, coverage limits may apply.

9. Landscaping and Trees May Be Covered

If a storm, vandalism, or other covered event damages trees, shrubs, or landscaping, some policies will reimburse part of the cost of replacing them.

10. Filing Too Many Claims Can Increase Your Premium

Frequent claims may label you as a high-risk policyholder, leading to higher premiums or policy non-renewal. Consider covering minor repairs yourself to avoid unnecessary claims.

11. Home Insurance Policies Have Limits on Valuables

Standard policies may have coverage limits for high-value items like jewelry, artwork, and collectibles. If you own expensive assets, you may need additional coverage, such as a personal articles floater.

12. Your Dog’s Breed May Affect Your Insurance Rate

Certain dog breeds that are considered high-risk for liability claims may result in higher premiums or even exclusions from coverage.

13. Home-Based Businesses May Require Additional Coverage

If you operate a business from home, a standard home insurance policy may not cover business-related equipment or liability. A business rider or separate policy may be needed.

14. Burglary Claims May Require Proof of Ownership

To file a successful theft claim, insurers may request receipts, photos, or appraisals of stolen items. Keeping an inventory of belongings can help streamline claims.