Insurance Facts that will Scare the Devil out of You

By Catherine Powell

Image by Free Stock Photos

With Halloween having been last night, I thought this week I’d regale you with some scary facts and figures related to insurance.  While most people only think insurance is scary when they have to file a claim, what agents like myself consider scary is when customers shoot themselves in the foot by being underinsured or irresponsible.  Today’s blog is here to help you stop biting your nails to the quick with worry by pointing out some factors you may not have taken into consideration.

Dog bites owner?

If you own any kind of dog, you have to realize there is a certain amount of liability involved.  Whether your dog is a pit bull or a chihuahua, dogs big and small have the potential to bite a friend, neighbor, or other visitor to your home.  While Sparky may be gentle as a mouse, if something sets him off, you have a potential injury followed by a lawsuit.  If you don’t think Fluffy can turn into Cujo, think again.  Industry statistics report that 1 out of every 3 liability claims filed by homeowners is due to a dog bite, with the average claim in 2017 being $37,051.  Now here’s where the dog can bite its owner.  If you don’t tell your insurance agent that you own a dog, or you misrepresent the breed of dog you own, the insurance company can and will deny your claim.  Furthermore, that same insurance company may cancel your homeowner’s policy on the spot if you told them you didn’t own a dog when you really did.   

Where’s the fire?

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Another way you can shoot yourself in the foot is where fire is concerned.  While cooking fires are the most prevalent form of combustion that causes damage to homes, it isn’t the only way your home can go up in smoke.  Electrical fires, chimney fires and dryer fires are other potential sources of fire and smoke damage.  Even more alarming is the fact that any of these three could result in your insurer denying your claim.  Allow me to illustrate.  Let’s say you live in a 50-year old home that has never had its electrical system upgraded.  If those old wires start a fire and the fire marshal declares your house’s power grid isn’t up to code, your insurer will no doubt use this fact to deny your claim for fire and smoke damage caused by an electrical fire.  (The moral is, if you live in an old house, for goodness sake, have your power grid inspected and gotten up to code.) 

The same goes with a chimney fire.  While sitting in front of a crackling fire is always a cozy way to spend an evening in the winter, it also produces creosote, which is flammable.  If you haven’t had your chimney cleaned in 10-years or more, you have created a potential powder keg that could blow up in your face one night.  The second shock will be when your insurer denies your claim due to your negligence. 

The third home fire hazard that can cause you to get burnt twice are dryer fires. Even if you clean out the lint trap religiously on your dryer, over time the lint that gets past the trap will accumulate in the exhaust hose.  When was the last time you cleared out the dryer vent and hose?  Never?  Keep ignoring the fact that lint makes for great kindling and you could well wind up having laundry day take you to the cleaners when a dryer fire causes damage to your home that your insurer will refuse to pay.

What the Hail?

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Being that Florida is the thunderstorm capital of the country, it should come as no surprise that we also get our fair share of hailstorms.  These frozen chunks of precipitation rain down on the Sunshine State regularly while doing billions of dollars of damage every year.  When it comes to the insured, the two areas most often affected by hail damage are roofs and cars.  While your homeowner’s and auto policies should cover the damage, be sure you talk to your insurance agent before letting anybody else assess the damage or give you a quote for repairs.  Even worse would be to sign a document a contractor presents you by claiming they’ll “Take care of this for you.”  Unless the contractor is a licensed insurance adjuster or attorney, he or she is not permitted by law to act as an intermediary.  If you sign on with an unauthorized outside agent, you could wind up in hot water your insurer.

A thumb won’t plug these leaks?

Last but not least I’d like to talk about scary water damage.  There are several ways that water can cause damage to your home.  There’s flooding caused by heavy rain, there’s sewer backups caused by either rain or a clogged pipe, and there’s water damage caused by burst or leaky pipes. Fortunately for those us in sunny Florida, frozen pipes aren’t as much of an issue as they are in more northerly states.  However, leaky pipes are more prevalent and far more damaging than most homeowners realize.  Today, the average amount of damage caused by a leaky pipe is more than $20,000.  Why so high?  Aside from the damage caused to walls, carpets, floors and furnishings, a leak that occurs behind a wall can breed mold like rabbits.  Even worse, these claims can be denied in part or in full if the leak can be proven to be the result of neglect. They can also be denied if you come back from vacation to find out your home has been flooded by a leaky or burst pipe.  (Word of advice: Make sure you don’t neglect your home’s plumbing and turn your water main off before you leave for a vacation.)

You don’t have to build an Ark when you can get flood insurance for a lot less.  Yet many homeowners in Florida don’t purchase flood insurance because they don’t live in a designated flood zone.  Newsflash: You don’t have to live in a flood zone to have flood damage.  Another tidbit you should appreciate is when it comes to storm damage, water beats wind every time.  While your homeowner’s policy covers wind damage, it doesn’t cover flood damage.  Before you find yourself sweating bullets as another named storm takes aim at North Florida, talk to your insurance agent about adding flood insurance. 

One of the nastiest, most damaging forms of water damage is produced when a sewer pipe backs up into your home.  Aside from the water damage and stench produced from this kind of unfortunate incident, are the pathogens that can inundate carpets, furnishings, floors and drywall.  Should a sewer pipe back up into your home, the damage can be devastating and long lasting.  Worse still is that the damage may not be covered by your homeowner’s policy.  Some policies contain exclusions for water that backs up into sewers and drains.  Does your policy contain this exclusion?  Another potentially scary exclusion is if the backup was caused by roots growing in or other debris clogging up the outflow pipe.  The bottom line is if you don’t want to have a sudden scare regarding a sewer backup, you need to inspect both your policy and your sewer pipes soon.

Catherine Powell is the owner of A Plus All Florida, Insurance in Orange Park, Florida.  To find out more ways to save on insurance, check out her website at http://aplusallfloridainsuranceinc.com/