When considering what kind of home insurance coverage and which policy or policies you are going to purchase, there can be an almost overwhelming amount of information available. It’s easy to assume that a comprehensive homeowner’s insurance policy will cover most anything that you may need it for, however, that isn’t the case. Home insurance policies become more comprehensive and benefit greatly from add-on coverages. These are extra layers of insurance that protect specific aspects of your home and property not covered by a traditional homeowner’s policy. When choosing insurance for your home in New Jersey, three particular forms of add-on coverage are the most beneficial.
Equipment Breakdown Coverage
Homeowner equipment breakdown coverage protects the homeowner from the expensive repair and replacement costs of electrical or mechanical breakdown, rupture, or explosion of systems and appliances in their home. This coverage is a key example of an area where policyholders often don’t realize that they are unprotected. Some policies may have limited coverage restricted to certain appliances, but as technology evolves and many homeowners add more sophisticated and expensive technology to their homes (smart-home technology, security systems, etc.) what is covered and what isn’t can be an unpleasant and costly surprise when something breaks down.
For a practical example, imagine your small home is struck by lightning. All of the electronic equipment in your home is subsequently destroyed by the surge. Televisions, refrigerators, washer, dryer, and everything else. The damages are $8,000 in total. If you have equipment breakdown coverage, the cost of replacing or repairing your electronic equipment is covered. When seeking this policy add-on, it’s important to discuss with your insurance professional just what kinds of equipment and tech you’d like to have covered- and they can help you to seek the best policy add-on. It’s not a home warranty or a maintenance agreement, but it is a replacement agreement for certain systems.
Service Line Coverage
Service line coverage can be a major lifesaver when added to your homeowner’s insurance policy, and here’s why: service line coverage does exactly as it implies- it is an extra layer of protection that extends beyond the basic homeowners policy and insures the service lines running to and from your property. Basic policies of course protect your home, but they don’t extend to the service lines underground. This can leave you in a truly unpleasant mess when problems arise with sewage lines, leaky pipes due to rust, broken water mains, power issues and outages, or natural gas leaks. Service line troubles can be particularly costly, with thousands of dollars often needed to make repairs. Digging up lines often requires heavy equipment, machinery, or construction work costs. According to the American Society of Civil Engineers, nearly 240,000 water mains break every year. Cities are responsible for the main lines, and will handle the costs and repairs there, but homeowners are responsible for their own property service lines.
Imagine that your lawn is full of beautiful old growth trees. Perhaps that was one of the features of the property that really made you fall in love with it. Unfortunately, the roots from one of those trees has grown into your sewer line, and has caused a sewer back up. You are unable to flush your toilets or take a shower because nothing is able to run out of your drains. With service line coverage, the costs to resolve the issue are covered. Best of all, it’s an inexpensive add-on that proves incredibly useful.
Extended Water Backup
Extended water backup coverage helps to pay for water damage resulting from a backed-up drain or sump pump. For example, when rainfall is especially heavy and overwhelms the ability of drainage sewers to keep up, a problem frequently seen in New Jersey towns like Hoboken, water damage to the home can happen. This is a result of water having no place to go but up into the home. In addition to water damage, these scenarios can also lead to backup of raw sewage, overflowing in toilets, sinks, tubs, and basements. Sewage backups are a foul experience from start to finish, and require extensive cleanup, sanitation, and odor neutralization in addition to repair. Unfortunately this kind of damage is not typically covered by a standard homeowners insurance policy, or in the coverage under flood protection from the National Flood Insurance Program. As you can imagine, however, the costs can be prohibitive when attempting cleanup.
Extended water backup is beneficial, in that many policies include only limited coverage for water and sewer backup inside the home, generally around $5,000 worth. This amount doesn’t stretch very far when you consider the additional costs to remediate the damage- between the deductible and the costs of replacing whatever happens to be damaged in addition to cleanup costs. The primary issue with water damage, and the primary reason for adding extended water backup coverage to your policy, is that most forms of water damage are specifically excluded from your homeowner’s insurance policy. Extended water backup is an excellent way to protect your property further from disaster.
Understanding all of the minute details about homeowner’s insurance policies and which add-ons and coverage are the best fit for their clients is knowledge that a professional agent takes great care to cultivate. Spending time with a professional to put together a proper insurance policy is worth it. It’s important that the professional you choose to work with spends time helping to educate their clients about important add-ons. A good agent makes sure you understand the coverage and policy options available to you, assuring both that you are confident in your purchase, and that you trust their expertise when a situation arises.
