Not sure what to believe when it comes to what you’ve been told about home insurance? Truthfully, a lot of misinformation is spread about all kinds of insurance, with home insurance often leading the pack.
To help you tell what’s true and what’s not, let’s debunk some of the most common home insurance myths!
Myth #1: My home is insured for its resale value.
Truth: Your home is insured to cover the cost of rebuilding it, not to cover its resale value.
The rebuild value of the home is what it would cost to rebuild it from scratch in the event it is completely destructed by a peril covered under your home insurance policy, like fire. The dwelling coverage portion of your home insurance policy needs to be enough to cover the cost of rebuilding your home, which is usually a bit lower than the resale value as it doesn’t include the property it’s built on.
Myth #2: My home insurance policy includes flood damage.
Truth: This is an important topic because it’s essential that homeowners know exactly what they’re covered for. In the United States, home insurance policies do NOT include flood damage protection. Instead, you’ll need to buy flood insurance through the National Flood Insurance Program to make sure you have the protection you need.
Myth #3: If you operate your business at home, your home insurance policy includes your business.
Truth: This is not always true! When you purchase a home insurance policy, you must disclose to the insurance company that your business operates out of your home, and you may need to purchase additional coverage to include it. If you fail to disclose to the insurance company that your business is run out of your home, you risk being denied coverage when you make a claim.
These are just a few of the many myths floating around about home insurance policies. If you’d like to learn more about home insurance and picking the right plan for you, get in touch with Salt Lake City Insurance today!