You can learn a lot about an insurance policy from reading the exclusions. Insurance companies use exclusions to create products that aren’t cost prohibitive or to remove losses that aren’t insurable. Cost prohibitive exclusions are things like vacancy, neglect and mold. Uninsurable losses are things like war, and earth movement because the risk cannot be spread and threaten putting the insurance company out of business.
So what exclusions surprise some people? Below is a list of common exclusions.
Vacant homes: If you leave your home vacant for 30 days or more most likely will lose coverage for vandalism, and possibly water damage to the home. Vacant homes are targets for vandalism and water losses that would be a couple thousand in an occupied home can balloon if no one is there to catch them.
The definition of a vacant home can vary by policy, but typically a home is vacant if it is moved out of and the predominant amount of personal property has been removed. You can find the definition in your policy under the definition section of the policy.
Wear and tear, neglect, lack of maintenance, or failure to repair are other areas homeowners (especially new owners) often overlook as exclusions. An insurance policy isn’t designed to address maintaining the home, and therefore excludes these losses. For example if the roof is leaking an immediate repair is necessary vs. letting it get worse and worse until the problem can’t be ignored. This keeps insurance cost down for the majority of consumers who do maintain their home.
It’s important to read your policy and ask any questions to agent that you don’t understand. Going off gut feelings or intuition on what is and isn’t covered can lead to surprises come time to file a claim.