Understanding Insurance Claims

Three Property Insurance Endorsements Worth Considering

Homeowner's insurance is a complex topic, and it can be easy to overlook potentially beneficial coverage options or to opt out of useful coverage to try to save a few dollars on your premiums. A typical property insurance policy will cover damage to a property's structure and contents against a variety of risks, but it may not be comprehensive enough for all homeowners. To expand basic coverage, insurance companies offer things that are commonly known as endorsements. Policy endorsements add additional coverage to an existing policy, either protecting you against unusual risks or providing replacement value for items that may not be typical.

Although most policies offer a bewildering array of possible endorsements, there are a few common ones that are worth considering. Even if these endorsements do not apply to your situation, it is worth discussing other available endorsements with a policy expert at the insurance company.

Extended Replacement Cost

Extended replacement cost endorsements are one of the most popular types of endorsements available — and for good reason. This endorsement protects you against potential increases in the cost of rebuilding your home following a claim. Without this endorsement, the cost of repairing your home may exceed your normal coverage limit. This cost overrun can happen for a variety of reasons, but it can leave you paying repair costs out-of-pocket or being forced to accept your home as a total loss. With an extended replacement endorsement, your insurance will provide a percentage increase to your insured value to cover additional repair and replacement costs during the rebuilding process.

Home Business Insurance

Typical items found in a home office are often covered under normal homeowner insurance policies, but the value of these items may exceed existing limits. Additionally, your insurance policy may specifically limit coverage for business assets. If you have business equipment such as a computer, printer, fax machine, etc., you may easily exceed your base limits. A home business insurance endorsement increases these limits, preventing the loss of expensive business assets if your home is damaged or destroyed.

Sewer Coverage

Sewer backups are expensive to repair, not only because plumbing work is rarely cheap, but because a backed-up sewer line can cause extensive water damage and even require environmental clean-up. Most homeowner's policies will cover damage caused by a pipe bursting or other sudden plumbing failures, but they may not cover sewer backups or other gradual problems. Sewer coverage is a common endorsement since it can potentially save vast amounts of money following a major sewer disaster.

For more information on property insurance, contact an insurance company.