Homeowners insurance
is a complicated topic, and there are a lot of myths out there about what it covers and how to use it. If you're like most people, you only think about your homeowner's insurance coverage every once in a while. That's okay! As long as you have the right coverage and take care of your home, you'll be fine. 

But there are plenty of myths out there about what homeowners' policies cover and how they work—and those myths can get in the way of making smart decisions or getting good deals on coverage. In this post, we'll go over some common myths about homeowners insurance so that when it comes time to buy a policy or renew one with your current provider, you know exactly what's covered and what isn't.

Here's the truth about some common home insurance myths:

Myth: Home Owners Can Make Money Off Their Insurance Claim

No. You can't do that. If you have a homeowners insurance policy, you can't "make money" off of a claim. You can only get reimbursed for the amount of money that it would cost to repair or replace parts of your home or personal belongings when it/they get damaged or destroyed by fire, wind, hail or other natural disasters. Liability coverage is a special type of coverage that will help someone else if, for example, they hurt themselves on your property.

The idea is that if you have a claim and your homeowner's insurance company pays out the amount of the claim, they will then factor in their costs and make money off of that. The problem is that your insurance policy is actually a contract between you and them. They pay out what they owe, and you pay premiums each month or year to keep it up.

The only way that you could make money off of your homeowners' insurance is if you purposely damaged your personal property yourself so that you could file a claim and get some cash back from the insurance company. The truth is, no one has ever managed to get away with this scheme. The fraud investigators are too good at sniffing them out.

Myth: You Have to Pay Your Deductible To Your Home Insurance Company

One of the most common myths about homeowners insurance is that you have to pay your deductible to your insurance company. But here's the truth: Your deductible is paid directly to your contractor. When it comes time for repairs or replacements, you'll simply submit a claim, and your deductible will be subtracted from the total amount due.

You can also choose to set up an escrow account for future repairs or replacements—your contractor will arrange this with them directly—so you don't have to worry about paying out-of-pocket every time something needs fixing. This way, when the time comes, you won't have to worry about getting all the money together in one lump sum.

Myth: You Have To Use The Contractor That Your Property Insurance Company Recommends

You're probably thinking, “I've heard that if you want to get a good deal on insurance, you have to use the contractor that your property insurance company recommends.” Well, that's not necessarily true. The truth is, most property insurance companies will make some recommendations for contractors who they think will do a good job with your project. However, there are plenty of other contractors who could do just as great of a job and they may even be cheaper.

So if you're looking for a way to save money on your home improvement projects (and also make sure your home is structurally sound), don't just follow the recommendation of your property insurance company, do some research and find one that fits both your budget and your needs.

Myth: The Homeowner Insurance Cover Claim Amount Is the Final Cost

The home insurance cover claim amount is just a rough estimate of the costs that may be incurred if you have an accident or damage to your home. The actual costs will depend on your policy and the amount of coverage you have purchased.

When you file a claim for damage to your home, the insurance company will pay you for the costs of repairing that damage. But what if your contractor is charging more than the claim amount? Can you still get paid for the difference? The answer is yes! If your contractor charges more than what the claim amount is, and if those extra costs are reasonable and justified, then your insurance company will pay them. If they don't, call us right away so we can take care of it for you.

Myth: If Your Claim Is Denied And It Matches Your Home Insurance Quote There Is Nothing You Can Do About It

If your claim is denied and it matches your home insurance quote, do not be afraid to fight for what you deserve (insurance coverage). Homeowner's insurance companies are notorious for denying claims that should be paid out. If you have a home insurance policy with specific stipulations, such as a deductible or sub-limits, it is important to make sure that you understand what those stipulations mean before making any claims for damage caused.

If you believe that your claim was wrongfully denied, there are steps that you can take. The first step is to contact the company and ask them why they denied the claim. You may want to ask for an explanation in writing if possible so that you have evidence of their response. If there is no good reason for denying your claim it may be time to seek legal counsel from an attorney who specializes in this area of law to help get homeowners coverage.

Myth: Your Homeowners Insurance Quote is the Price of Your Insurance

This is not always the case. Your homeowner's insurance quote is an estimate of what your insurance will cost. The final price of your insurance will be determined by many factors, including the type and amount of coverage you choose, the value of your home, and the location of your home.

It's important to remember that your homeowner's insurance quote is not set in stone. If you find a better deal elsewhere, you can always switch insurers. You should also shop around for homeowners insurance every few years to make sure that you're still getting the best possible rate.

Myth: Homeowners Insurance is a Waste of Money

This couldn't be further from the truth! Homeowners insurance is an important way to protect your home and your belongings. If you have a mortgage, your lender will require you to have homeowners insurance. Even if you don't have a mortgage, it's still a good idea to have insurance to protect yourself from fire, theft, and other types of damage.

Myth: You Can Afford To Go Without Standard Insurance Coverage

You can’t. The cost of repairs is too high and will bankrupt you. Let’s say you have a fire in your home that damages three rooms, totaling $30,000 in repairs. If you don't have insurance, then what? You could take out a loan to pay for the damage, but how will you pay back the loan? Will it cripple your financial situation so badly that it would be impossible for you to ever retire? It doesn't make sense!

Myth: You Can’t Buy Flood Insurance if You Live in a High-Risk Flood Area

The national flood insurance program offers discounts on premiums for homeowners who live in high-risk areas if they purchase insurance and take measures to reduce their flood risk, such as elevating their homes.

If you live in a high-risk area, contact your insurance agent to see what options are available to you. You may be surprised to find that you can get coverage for less than you think.

Get a Home Insurance Policy

Homeowners insurance is a contract between you (insured) and your insurer. The policy obligates the insurer to pay for certain losses (such as fire or water damage) that occur while the policy is in effect. But it also requires you to tell the truth about what happened, so that when a claim arises, everyone knows exactly what happened and why.

The home insurance coverage contract doesn't have anything to do with how much money your mortgage is worth, or whether it's worth rebuilding after a disaster like a flood insurance package or a tornado. It doesn't have anything to do with how hard it was for you to replace all of your furniture after someone stole it out of storage while they were renting out your house while you were traveling abroad. All those things are outside of homeowners' policies because they're not covered by them.

A Few More Things You Need to Know

Your homeowner's insurance coverage is broken into a few separate policies that might be worth mentioning:

Dwelling Coverage

This is the part of your policy that covers the physical structure of your home.

Other Structures Coverage

This is the part of your homeowner's policy that covers structures on your property that is not attached to your home, such as a detached garage or shed.

Personal Property Coverage

This is the part of your policy that covers the contents of your home, such as your furniture, clothing, electronics, and other personal belongings.

Actual Cash Value Coverage

Actual cash value (ACV) coverage pays to replace your damaged property with items that are similar in age, quality, and condition to what was lost, minus depreciation.

While homeowners insurance can be complex, it's important to have accurate information about what your policy covers. Remember, your home is one of the biggest investments you'll ever make and one of the most vulnerable. There are many myths and misconceptions about homeowner's insurance. It is important to do your research and understand what your policy covers so that you can be prepared in the event of an accident or disaster. Don't let these myths deter you from getting the coverage you need!

If you're in need of roofing repairs or replacement, don't hesitate to give Homestead Roofing a call. We can work with you and can help you navigate the claims process so that you can get your roof repaired or replaced as quickly as possible. Give us a call today!