Home Insurance: 5 Coverage Gaps That Could Cost You Everything

Your homeowners insurance probably has holes big enough to bankrupt you. Most people discover them after a disaster.

1. Flood Damage

Standard homeowners insurance does NOT cover floods. Even one inch of water causes $25,000+ in damage. Separate flood insurance through NFIP costs $500-1,500/year.

2. Sewer Backup

Not covered by default. A sewer backup averages $10,000-20,000 in cleanup. Add this rider for about $50/year.

3. Underinsured Replacement Cost

If your home costs $400,000 to rebuild but you are insured for $300,000, you eat the difference. Review your policy annually as construction costs rise.

4. Home Office Equipment

If you work from home, your business equipment may have limited coverage under personal policy. Ask about a home business endorsement.

5. Jewelry and Valuables

Most policies cap jewelry at $1,500-2,500. If your engagement ring is worth $10,000, you need a scheduled personal property rider.

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