Our Top 10 Expensive Insurance Mistakes

HomeAdvisor.com recently conducted a survey in which homeowners expressed their greatest fears. Of those surveyed, 5% were scared of zombies, or finding out their home was haunted. 32% of survey participants feared a pest infestation in their home, while 36% feared suffering vandalism, theft, or a break-in. Lastly, 44% of homeowners surveyed said that storm damages or a natural disaster scared them the most. Homeowners insurance is there for times like this. A homeowner’s policy serves as a guarantee that if your home is damaged, you won’t be left homeless with nothing. Some homeowners only purchase insurance because it’s required for their mortgage, and the majority of homeowners don’t spend a great deal of time reading through their policies, Kirby Soar Insurance, your independent insurance office in Central Florida, wants to make you have the right policy to protect your family. That’s why we want to share this list of 10 costly insurance mistakes that you should avoid. 

homeowners insurance mistakes

1. Paying Too Much Money

 According to Consumer Reports, only 9% of homeowners have switched insurance providers in the last three years. Of those people, 50% find new policies that save them up to $1,000. You often can find quality coverage at a lower price by contacting an independent insurance professional like our staff at Kirby Soar. Because we are not agents of any one insurance company, we can work with a variety of different insurers to help you find the right price.

2. Buying The Wrong Coverage

According to CoreLogic, approximately 60% of homeowners do not carry enough insurance coverage. Why is this? It could be due to a lack of policy understanding, assumptions made by the homeowner, rising costs in construction, property value changes, or errors on the part of the insurer. A typical homeowner policy will cover personal liability, structural damage to the home or outbuildings, and temporary rehousing in case of emergency. However, your homeowner coverage may not compensate damage from a flood, fire, or some types of theft and vandalism. 

3. Filing Small Claims

Many people avoid making small claims because they don’t understand the process or they are scared of increasing insurance premiums. However, 57% of those who responded to a Consumer Reports survey filed small claims last year with their homeowner’s insurance and did not see their premium increase.

4. Skipping Flood Insurance

Even if your home isn’t a waterfront property or in a designated FEMA flood zone you should be considering flood insurance. This coverage provides protection in the event of flooding from weather events, as well as plumbing issues, municipal water, pools, and even poor drainage systems around your home.

5. Assuming Damages Caused By Animals Are Covered

While a wide variety of insurance policies do include animal damage coverage, the typical homeowner’s policy will not protect you from damage caused by household pets, termites or vermin. However, many policies will cover your home in the incident a bear or other type of larger animal damages something on your property. 

6. Not Filing An Accurate Claim

If you need to make a large claim—defined as costing more than $20,000—then you will need to have a solid reason for the claim. Additionally you’ll need to be able to prove that your claim is 100% legitimate. You also should not be surprised if it takes your insurance company a little longer to get the money to you.  

7. Having Bad Credit or No Established Credit

Only three states (California, Maryland, and Massachusetts) have made it illegal for insurance providers to use credit scores to decide the insurance premiums. That means insurance providers in any of the other 47 states, including Florida, will decide your insurance premiums based in part on your credit score. Moreover, your insurer is not legally obligated to tell you that it uses your credit score to help determine your premium amounts.

8. Overlooking Personal Property Payout Limitations

If you possess expensive personal items (such as personal electronics, jewelry, clothing, or artwork), they probably are not covered by your homeowner’s policy, which only will cover about $1,500 of the value of these items. For high-end goods, you need to protect them under a separate policy called a “floater”, which have a zero deductible and will cover accidental loss.

9. Presuming Hail Coverage

A large percentage of insurance policies don’t cover damage incurred from hail. If your homeowner’s policy does cover hail, most likely it requires special deductible percentages. That means you have to pay a percent of your home’s value as the deductible cost in repairs before the insurer will pay anything. 

10. Assuming Your Landlord’s Policy Will Cover Your Belongings

Just because you rent instead of own, this doesn’t mean that you’re safe. Landlords usually only insure the value of the property. None of your personal belongings or your expenses are covered under these policies, which is why renter’s insurance is available. 

Kirby Soar Insurance Helps You Avoid Insurance Mistakes 

Insurance can be complicated. If you need help understanding your policy, or think you may need more coverage, contact Kirby Soar Insurance to get help. Schedule a consultation with one of our experts by calling us at (813) 752-1680. We’re proud to serve the insurance needs of our clients in Plant City, Valrico, Lakeland, Brandon, and throughout central Florida.