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COSMETIC DAMAGE EXCLUSIONS IN HOMEOWNERS POLICIES, IS YOUR POLICY SUBJECT TO THIS LIMITATION?

As a consumer in the market for obtaining a homeowners policy it’s important to check with individual insurance companies to confirm the coverage provided by their policies. However, most companies follow similar standards of protection for homeowners. This is where an independent agent can be extremely beneficial when on the hunt for the right coverage at the right price. Independent agents have access to many different insurance carriers and can help to shop, compare coverages and any possible exclusions that limit coverage amongst many carriers.

The following are perils that are commonly covered in different degrees depending on the type of Home Owners policy purchased.

  1. Fire or lightning
  2. Windstorm or hail
  3. Explosion
  4. Riot or civil commotion
  5. Damage caused by aircraft
  6. Damage caused by vehicles
  7. Smoke
  8. Vandalism or malicious mischief
  9. Theft
  10. Volcanic eruption
  11. Falling object
  12. Weight of ice, snow or sleet
  13. Accidental discharge or overflow of water or steam from within a plumbing, heating, air conditioning, or automatic fire-protective sprinkler system, or from a household appliance.
  14. Sudden and accidental tearing, cracking, burning, or bulging of a steam or hot water heating system, an air conditioning or automatic fire-protective system.
  15. Freezing of a plumbing, heating, air conditioning or automatic, fire-protective sprinkler system, or of a household appliance.
  16. Sudden and accidental damage from artificially generated electrical current (does not include loss to a tube, transistor or similar electronic component)

Some of the disasters commonly excluded from home insurance policies include floods, earthquakes, sinkholes, mudslides, war, nuclear accidents, landslides, mudslides and sinkholes.

In addition, due to the severity of storms in recent years and due to the influx in claims as a result of wind and hail claims a “Cosmetic Damage Exclusion” form has been introduced into the marketplace. The hail and wind exclusion which insurance companies can choose to adopt or not would exclude payments for damage to exterior surfaces, including walls, roofs, doors and windows from hail or wind if the storm event only impacts the appearance and not the function as a barrier of those elements.

Of note the hail and wind exclusion is different from windstorm and wind and hail deductibles that are common in hurricane prone states such as Florida.

In addition, the endorsement enables an insurer to exclude one component or material such as the roof or metal components. It’s important to review your policy carefully and know what the homeowners insurance premium you’re paying for covers and what you as the consumer are willing to accept.

To learn more about this exclusion and the implications it could have on a homeowners policy and damage that was traditionally always covered and if your policy is affected or not please contact one of our personal lines advisors today.

Stacey Elders, CRIS