What Does Homeowner’s Insurance Cover in Florida?

Homeowner’s and renter’s insurance are both types of property insurance specially to protect your home. For homeowners, home insurance covers both the physical building and its contents (assuming the owners stays in the house). Renter’s insurance doesn’t cover the building where the renter is staying but the contents inside the house, such as furniture, will be covered. But what does homeowner’s insurance actually cover in Florida? While you know your building and belongings are insured, you might not be sure what kind of damages you can claim for.

What Does Homeowner’s Insurance Typically Cover?

Not all homeowner’s insurance policies are the same, so by knowing your policy, you can familiarize yourself with the terms and conditions. However, homeowner’s insurance should typically cover a broad range of incidents that could occur.

If you own the building where you stay, your home insurance policy should cover both the building and its structures (garages, outside buildings, decks etc.) and the contents of your home.

Your policy should ideally cover most of your home’s contents, but certain things are excluded from most policies by default. Cellphones, laptops, watches and other portable items often need to be covered separately from your home’s contents. This is mainly because these items are portable and therefore aren’t considered as part of your home’s standard contents. To cover portable items like cellphones and jewelry against accidental loss or theft, even if you lost them when you weren’t at home, usually requires you to add a special rider for them on your home insurance policy.

Depending on your policy, your home insurance may still cover your jewelry and cellphone if you lost it in a house fire or other insured incident.

Home Insurance Coverage Levels

There are three main ways you can insure your house and its contents. The amount of cover you get will depend on which option you choose.

Actual Cash Value

When you choose this option, your home and contents will be insured for the amount they are worth at any given time. What this means is that if you lose your house and contents, your insurance provider will pay out the amount that your home and its contents are worth at the time you lose them.

The problem with this insurance model is that depreciation of value is factored into the value of your belongings. So, if an incident occurs and you suffer the loss of an important piece of furniture, your insurance will pay out the amount that item was worth when you lost it. Of course, being a used item, your insurance provider will likely value the item at 50% or less of what it would cost to buy a brand new item.

All regular household items that depreciate in value will have less cover with each year gone by.

Replacement Cost

A homeowner’s insurance policy that covers your property at replacement cost won’t factor in depreciation. This means that if you have an insured item that will cost $1000 to replace, your home insurance will pay out the full $1000 to replace it. Even if the item was 10 years old and worth only $150 when you lost it, your policy will still pay out $1000 for replacement, as the depreciation on the item isn’t a factor in this case.

In case of damage to your home or buildings – your policy will pay out enough so you can rebuild your home to its original value. In this case the term “original value” refers to what the house cost when you first bought it. It goes without saying that this isn’t always the same amount you need for full repairs, which is something you should discuss with your insurance provider before taking out cover.

In concept, having home insurance at replacement cost means you’ll run a loss in case of structural damages to your home. If your house increased in value by 15% since you bought it, your insurance provider won’t pay out for repairs in full. After claiming for repairs on your house, it will be restored to the original value you bought it for, minus the 15% increase in value since purchase.

Guaranteed/Extended Replacement Cost Value

Extended Replacement cost value insurance is one of the most comprehensive homeowner’s insurance policy models on the market.

With this type of cover, your home and contents aren’t covered only for replacement cost. If your home appreciates in value after purchase, your policy will pay out for home repairs to restore your home to what its current value was before an incident. This means that if your home appreciated by 15% since you bought it, your policy will pay for full repairs to restore its actual value.

This form of homeowner’s insurance still isn’t fool proof. There is usually a specified limit on how much more an insurance company will pay out. Usually this amount will be 20%-25% higher than your original policy limit.

To avoid losing out when you claim for home insurance at either replacement cost or extended replacement cost value, it’s good to review your policy every few years by updating it to the current value of your home and contents, if possible.

What Does Home Insurance Pay Out for?

It’s good to know what you can claim for on your home insurance policy. While most regular damages will be covered, there are certain losses you would need to cover by adding a rider to your policy.

Dwelling and Personal Property Coverage

Dwelling coverage insures the building where you stay. So, if your house is damaged in an incident for which you’re covered, your dwelling coverage will pay out for repairs, or possibly even to rebuild your home entirely if you lost it.

Property coverage, on the other hand, insures the contents of your home. So, if someone broke into your home and stole your belongings, you should be able to claim for property cover.

Loss of Use Coverage

Suppose your house is damaged by a tree that fell on it. During the time your house is being repaired, you might not be able to stay in it. If this happens, your home insurance provider might pay for you to stay in a hotel or some other form of alternative accommodation.

Talk to your insurance provider to ensure that you’re covered for loss of use.

Personal Liability Cover

If your home insurance policy includes personal liability cover, you can claim for damages you and your family cause to others. Usually, this cover is intended to pay out if a visitor on your property was injured and you’re at fault.

If, for instance, your dog bites a visitor, your homeowner’s insurance will pay out for legal fees and possible damage claims against you. Another example is if a visitor on your property gets injured by tripping over something in your yard and decides to sue for damages, claiming your grass was too long, and so they weren’t able to see where they were walking.

Personal liability coverage will also pay out if a third party claims for damage to their property against you. For instance, if a tree in your yard fell over onto your neighbor’s house, they might file a claim against you to fix their damages. Perhaps they argue that the tree always posed a significant hazard and you should’ve removed it a long time ago. If they take you to court and win the claim, your insurance should cover the legal costs to the maximum amount of your benefits, as well as the costs of the claim against you.

Cover for Other Structures

Other structures on your property, such as garages, pools and sheds are insured under a separate form of cover than your home insurance. This, however, doesn’t mean that your current home insurance policy won’t pay out for other structures. Whether or not you’re covered for damages to other structures will depend on what policy you currently hold. Contact your insurance provider to learn more about the current benefits your policy provides for other structures.

Things Homeowner’s Insurance Won\’t Cover

Standard homeowner’s insurance policies tend to pay out for the following:

  • Damage from house fires
  • Structural damages, like burst geysers and water pipes
  • Loss through theft for home contents
  • Physical injury and property damage you cause to another person (related to your home)
  • Damage caused by accidents. If you accidentally drive into your garage door or mailbox – your insurance might pay out for the damage to your residence, but not your car

It’s difficult to know exactly what you’re covered for. Insurance providers will typically have their own standard policies that might exclude covering house fires, for instance, but this is uncommon.

There are, however, some forms of cover that often require you to take out a rider on your policy if you want to claim for such damages. Damages that aren’t typically covered by home insurance policies include the following:

  • Damage from natural disasters or acts of war: If your house is damaged by a hurricane, floods or bomb explosion, you won’t be covered unless you have an applicable rider on your policy.
  • Acts of malice: If you intentionally cause damage to a third party by injury or property damage, or if intentionally damage your own property, you won’t be able to claim for your losses.
  • Mold growth: The growth of mold can be a big problem in Florida’s hot, humid weather conditions, unfortunately your policy is unlikely to pay out to fix a mold problem.
  • Home maintenance: Your insurance won’t typically pay to fix wall cracks or tiles breaking. Things like leaky roofs are usually covered, but not if the leak originated as a result of your negligence to maintain your property.

In a nutshell, your insurance will pay for everyday accidents and incidents (which excludes natural disasters) and will pay out for water damage and structural damages provided you maintain your property as necessary.

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