What are the Most Common Homeowner’s Insurance Claims?

An Overview of Home Insurance Claims

Homeowner’s insurance isn’t a luxury; it’s a necessity. Like many Americans, your home is likely to be one of the most valuable assets you own. While home insurance isn’t a legal requirement, mortgage companies require borrowers to have insurance that covers the fair value of the property.

Standard home insurance policies generally cover damage to your home’s structure and personal property. At an average cost of $1,445 per year, a homeowner’s insurance cover is the best way to protect your personal property and investment.

As a homeowner or would-be homeowner, you naturally have questions about your home insurance cover. To help you get a better understanding of your coverage, here’s a blog post detailing the most common home insurance claims – according to national data gathered by the Insurance Information Institute.

1. Wind Damage

Roughly one in forty homes has a wind related insurance claim every year. Hurricanes, tornadoes, and strong thunderstorms are known to cause severe damage. Fortunately, your standard home insurance policy will cover damage from wind or hail, but you might need additional coverage if you live in certain areas like Tornado alley. Talk to your insurance agent to confirm whether you need to purchase additional coverage.

Many insurance companies will require you to pay a windstorm or hurricane deductible if you live in an area prone to tropical storms with high winds. With an average claim cost of about $10,000, it’s best to protect yourself as much as you can.

2. Water Damage

Water damage from flooding, leaking or bust plumbing, overflowing sinks, and leaking roofs is the second most commonly occurring claim. It’s also one of the most expensive claims, with an average claim severity of about $11,000 between 2015 and 2019.

Unfortunately, your homeowner’s insurance will only cover water damage if the leak was sudden and accidental. For example, your insurance may cover a water leak from an old pipe or a ruptured water heater. It’s important to note that insurance products will not cover damage resulting from poor maintenance.

On this note, home insurance policies don’t cover damage from natural flooding, no matter the source of water, whether it’s from a heavy storm, surging water bodies, or over-saturated groundwater. If you live in a flood-prone area, your best option is to purchase separate flood insurance from the National Flood Insurance Program or a private insurance company.

3. Fire and Lightning Damage

It’s not surprising that fire claims are the most expensive insurance claims. Still, the average home insurance claims from fire or lightning damage came in at a staggering $78,838 between 2015 and 2019. It’s a good thing that fire damage isn’t too common with about one in 365 homes filing claims related to fire and lightning each year. Still, a single fire could easily destroy your entire house and everything within, so it’s crucial to be vigilant.

The good thing is fire and lightning damage is fully covered under your homeowner’s insurance. Your policy could cover the full cost of a rebuild.

4. Theft

Home break-ins occur more frequently than you would think, with about one in 425 homes having a property damage claim due to theft each year. Home insurance typically covers theft, assuming it wasn’t due to negligence. So, it’s a good idea to invest in a home security system.

Most of the items taken in burglaries can be replaced by your personal property coverage. If any property damage occurred during the process, like a broken door, your dwelling insurance will cover the cost of insurance.

5. Non-Theft Property Damage

What happens when a tree suddenly falls and damages your roof? Non-theft property damage insurance claims may rank in the fifth position, but they do carry a hefty price tag with an average claim cost of $6,406.

6. Bodily Injury and Property Damage

Liability insurance claims make up under one percent of all claims, but they’re incredibly costly, with the average claim coming in at just under $30,000. Liability refers to your duty to other people, so liability claims cover the cost of lawsuits for bodily injury or property damage caused by the policyholder to others.

It covers injuries suffered by others on your property like dog bites and trampoline accidents.

Get Enough Insurance Coverage

Homeowner’s insurance covers exist to protect you and your investment. It gives you peace of mind and can save you a lot of money in the long term. It’s important to choose the right homeowner’s insurance as this will determine the ease of the home insurance claims process. Consider the quality of customer service and always go through the terms and conditions.

Even though insurance covers most damage from common home insurance claims, it’s still important to take the necessary precautions to protect your home. A previous filing claim will come up during insurer underwriting, which determines the insurance premium you’ll be charged. You might even have to pay your deductibles out-of-pocket.

If you’d like an insurance quote or have any questions regarding the claims process, contact Coleman Insurance Agency to schedule a free consultation.