Homeowners Policy Review

Paul was SO excited! 

His hard work and determination to save finally allowed him to do one last thing to his home – he was able to expand his detached garage from a simple one-car garage to a four-car garage.

What an accomplishment! And it was beautiful. It looked like it had always been there. The contractors did a wonderful job of tying in the look of it to the architecture of the house. It was a thing of beauty.

Plus, as he shared with his wife, it would really increase their resale value if they ever decide to sell.

Finally, there was room for his car AND his wife’s car plus space for a workshop, some storage, and the riding mower would fit as well. No more parking outside. No more clearing snow off the car to go to work on a Minnesota morning. No more worries about a freak storm damaging one of the cars.

It could not be more perfect.

Until a tree fell on it.

That’s when Paul discovered that his homeowner's policy had coverage limits for a one-car garage. Not a four-car garage. 

Paul cried.

Had he made one phone call to his insurance agent to let them know of this great accomplishment, he would have changed his coverage to include the new garage. But he hadn’t done it. And his agent hadn’t called HIM in years – probably, he thought to himself, not since he had originally purchased the policy.

A Wake-Up Call

After hearing the devastating news that his loss would not be fully covered, Paul found himself asking a very important question: What other improvements had he made that his insurance company knew nothing about?

A few years ago, he and his brother-in-law had built a garden shed in the far corner of the back yard. The riding mower lived in there as well as all the garden tools. He also installed a greenhouse on the side of the shed so that they could get an early start on tomato seedlings for spring planting. 

He had installed screens on the back porch to keep the mosquitos out, just last year. And a gorgeous outdoor kitchen was right off the screen porch, with a top-of-the-line grill, a smoker, a refrigerator, and a prep counter.

Were the coverage limits that Paul had included in his policy sufficient to provide coverage for these improvements in the event of storm damage, fire, or even a tornado? 

Easy to Forget. Plan to Remember

It’s easy to forget about “other related structures” when you’re buying homeowner's insurance – particularly if they’re structures you’re adding or improving after you originally purchased your insurance policy. 

And it’s logical to think that, if you have homeowners insurance, that everything you own as a part of the home would automatically be covered. 

Don’t plan on that being true. Instead, plan ahead to remember to update your insurance agent any time you make any major improvements to your home or on your property. They don’t need to know when you’re painting a room, but you DO want to check in when you do things that could impact the value of your home and property or the safety of your home and property.

A few examples (not intended to be a comprehensive list): 

• Installed new smoke and carbon monoxide detectors
• Added a pool
• Built a garden shed
• Bought a home security system or simply added a doorbell camera
• Installed a sump pump
• Got a new roof 
• Expanded the garage

Not Just Home Improvement

Other life changes can also impact your homeowner's policy. For example, the tools and the big riding mower in your garden shed are considered personal property. Do you have enough coverage for those? Perhaps you bought a new mower that has many more features (and cost substantially more) than your old one? 

Did you inherit some expensive jewelry or artwork? Don’t assume it’s automatically covered. Get on the phone with your agent and determine if you need a special schedule added to your policy.

If you installed a sump pump, you may want the specific additional coverage for water backup and sump pump overflow. Again, call your agent.

Got kids and love them so much you bought them that backyard trampoline they’ve been begging for? You could need additional coverage just for that. 

It’s Up To You

As we have shared before, it’s ultimately up to you to make sure that your policy covers your risk. Review your policy to see if you have coverage for some key components to any homeowner's policy: any structure on your property and its contents, medical payments to others, and liability to others. 

When your agent checks in with you to see what has changed since your last conversation be sure to mention ALL improvements and changes you’ve made. Some might mean a change in your coverage. Others will just be nice things to chat about. 

Be sure. 

And if your agent doesn’t check in with you at least annually, consider finding an agent who does.

Start a Quote Online or Contact Us. We look forward to hearing from you.

This article is for general information only and should not be considered an offer of insurance or legal or other expert advice.  The recommendations herein may help reduce, but are not guaranteed to eliminate, any or all risk of loss.  Claims illustrations herein are hypothetical and for discussion purposes only.  Coverage will be determined based on the facts of the claim and the terms of your policy, if approved for issue.  Policy limits, deductibles, conditions, and exclusions may apply.  Your eligibility and premium will depend on the application of Federated’s underwriting guidelines to your unique circumstances including, but not limited to, your personal information, loss history, location, and coverage.  The information herein is current as of September 2022 and is subject to change.  Coverage not available in all states.  Qualified counsel should be sought with questions specific to your circumstances.   Policies are underwritten by Federated Mutual Insurance which is licensed in Minnesota.