Who knows better than you, what you own and care about? I often hear folks say they’re ‘insurance poor,’ but what they’re really saying is, they feel like they pay too much money for something they don’t plan to ever use.
Sudden and accidental events are the things insurance is designed to cover. The best thing you can do is to knock the dust off your policies and book a meeting with your agent. If you use multiple agents for different products, you can talk to all of them, or a single qualified agent to discover any gaps in your coverage.
What’s a gap in coverage? There are many different types of insurance, but let’s focus on gaps in property insurance. All policies have deductibles, that portion of the claim for which you are self-insured, and every policy has a list of ‘perils,’ or covered events which must take place for a claim to be paid. What does this mean?
Well, if your ski boat broke down, because you didn’t taken care of the motor, that would be a maintenance issue, so not insured. However, if your ski boat (which is listed on your policy by name and serial number) crashed into the dock, that would be a sudden and accidental event, therefore covered by your insurance policy.
True story. An insured called me once, after they wrecked their almost new, fifteen-thousand-dollar ATV. They wanted to file a claim, but they’d never added it to their policy. Unfortunately, it wasn’t covered because it was their responsibility to call and request it to be added to the policy after they purchased it.
Let me give you another example, this one not a true story, but true all the same.
Jimbob has a beautiful ski boat that he sunk all his savings into purchasing (he’s single, so he got to do that). Jimbob figures nothing is ever going to happen to his boat because he parks it in the brick carport attached to his nice house. A tornado comes through town, and it collapses the carport roof on top of his beautiful, uninsured boat. What happens? Jimbob is going to be very unhappy because his homeowners’ policy, that he pays every year, won’t cover a car/boat/ATV/UTV/Golf cart/super deluxe mower just because it’s parked at his home. Those types of motorized items must be added or insured on a separate policy, again, by calling your agent.
Rest assured, if you have a homeowner’s policy with contents coverage, most of your things inside will be covered, up to the policy limits (excluding motorized vehicles, so even if you park your ATV inside, it still isn’t covered). Keep in mind, there’s usually a cap on the amount of coverage built into all insurance policies for things like jewelry, cameras, musical instruments, silverware, golfers’ equipment, guns, fine art, stamps, and coin collections (not a comprehensive list). These things are covered, but only up to a specified limit (listed on the policy) unless you increase the dollar amount and pay an added premium.
Jimbob has a killer coin collection. His daddy and his granddaddy collected the coins over many years. He took the entire collection to a professional dealer, who appraised it at fifty-thousand-dollars and gave him an appraisal certificate. Then Jimbob sent the certificate to his agent and the agent added the coverage to the policy (and he paid an added premium). So now, if the collection is damaged by any of the covered perils listed on the policy, it’s insured for the appraised value (less his deductible).
Jimbob also has a gun collection. He keeps them in a fireproof safe and figures nothing will ever happen to them. Then a tornado hits, and they’re lost in the storm, along with his house. The house is insured and covered, but not his guns. The value of his collection was also fifty-thousand-dollars, but since he didn’t add it to his policy, the built-in broad form coverage is only twenty-five-hundred dollars. That’s all the policy paid for his fifty-thousand-dollar gun collection.
The burden of proof, such as a bill of sale or appraisal (less than three years old) verifying the value of your collectables/jewelry/guns etc. is solely the responsibility of the insured. I strongly encourage you keep copies of your insurance policies in a safe place, along with your deeds and other important information on your belongings. Spring is a great time to reevaluate your insurance needs.
Content provided by S. Leah Miles, Bacon County Agency Manager.