options and discounts may exist for your entertainment and security add-ons.
A simple, two-story home with a small yard and a white
picket fence used to be the quintessential home. But today, homeowners
customize their property with everything from online security devices to pools,
trampolines, elaborate backyard designs and even personal drones.
These trends have led insurers to continuously reshape and
refine their coverage offerings to reflect emerging needs. If you’ve made any
significant purchases or home improvements recently, you may want to explore add-on
insurance options to make sure all of your assets are fully covered. You may also
be eligible for discounts, if your improvements increase your home’s security.
Analyzing Your Home Risk
Carriers use predictive analytics to continuously assess the
risks of homeowners and adjust rates or coverage options accordingly. For instance,
after analyzing data on the large number of dog bite claims, insurers now ask if you own a dog and, if so,
which breed. If you have an aggressive breed, don’t be surprised if your
insurance policy denies coverage for dog bite claims.
It’s the same with items such as trampolines, unfenced swimming
pools, all-terrain vehicles and diving boards. These all add to a homeowner’s
risk – and many times insurers will not underwrite them in a standard policy.
Still, as technologies and gadgets continue to change, insurers
are trying to fill coverage gaps by adding endorsements, integrating new lines
of coverage, expanding discount packages and customizing policies to meet consumers’
interests. Soon, homeowners will be able to buy policies with options to add
cyber liability, identity theft protection, flood coverage, mortgage life,
special limits for toys and equipment breakdown.
A few examples of add-on insurance that have gained traction
recently include water and surge back-up, which minimize damage due to a water
line malfunction, as well as mechanical breakdowns. Many homeowners are
particularly drawn to mechanical breakdown coverage, which is also known as
home warranty coverage. This covers repair costs and partial replacement costs
for appliances such as HVAC systems, refrigerators, washers and dryers.
Look for Discounts Related
to Your New Purchase
As more people start to employ smart home technologies to
keep their homes safer, such as connected water sensors, smoke detectors and
door bells, insurers will be measuring how these items will have an impact on your
homeowner’s policies. Some items, such as water shut off systems, which have
the potential to reduce water loss claims, may earn you a discount if you have
that device installed. Others, such as sensors which indicate alarm system activation,
may result in removal of your home security system discount if you regularly
forget to arm the system.
Consider the Cost of
Personal drones have also recently come to the attention of
insurers. The question over these gadgets centers on whether any bodily injury
or property damage caused by these toys is covered under a normal homeowner’s
policy. The current answer seems to be yes, but that may change if there’s a
rise in use and accidents.
Vacation rental by owner (VRBO) properties add another layer
of complexity to homeowner’s insurance. Considered a commercial enterprise, any
damage caused by a renter would fall under VRBO coverage and not regular
homeowner’s insurance. But home-sharing services such as Airbnb, where you may
rent out a room in your home for a few days, do not pose quite the same risk as
a VRBO, and insurers are currently determining the best way to underwrite this
so much change in the marketplace, it’s a good idea to review your policy
regularly to make sure you are getting all the coverage you need – or all the
discounts that you deserve. Contact your HUB personal insurance broker
for more information.