What are Optional Coverages on a Home Insurance Policy
There are many exclusions on a basic home insurance policy. Some exclusions can't be added and are never really covered. However, there are also some exclusions that CAN be purchased as add-on (endorsements) or separate stand alone policies.
Most of these coverages are not automatic. If you would like to purchase one or more, you should make a request to your agent to add them.
Here is a list of common endorsement:
(See the endorsement forms for details):
Personal Property Replacement Cost
This covers the cost to replace damaged or stolen household contents (clothing, furniture, electronics, etc.) at the price you would pay for a new item in the market. The basic policy only covers the value of household items minus depreciation. We recommend buying replacement cost coverage for peace of mind.
Coverage C Increased Special Limits of Liability
The basic policy caps the amount it will cover for valuable items such as jewelry, electronic apparatus, firearms, silverware, or money. This endorsement allows you to increase coverage for those types of items.
Special Personal Property Coverage
This endorsement applies to household items such as clothing, furniture, appliances etc. It covers more kinds of losses (not covered by the basic policy) and increases the dollar amount covered for some items (jewelry, silverware, watches, etc.).
Additional Replacement Cost Coverage
This endorsement provides a percentage (i.e, 25% or 50%) more than the estimated cost (Coverage A) to rebuild the home. It offers protection if rebuilding the house costs more than expected.
Guaranteed Rebuild Coverage
It covers the full cost of rebuilding your home, replacing your personal belongings, and paying for you to live elsewhere even if the cost exceeds the policy limit.
Ordinance or Law Increased Amount of Coverage
This endorsement provides additional insurance to cover the increased cost of repairs that may be needed to comply with new building codes (especially plumbing, electricity and structure).
Identity Fraud Expense Coverage
This covers up to a set amount (i.e, $15,000) of expense you incur, such as hiring a lawyer, to help you resolve an identity fraud problem.
ID Monitoring and Protection Services
This is a special program to monitor and protect your identity. These services include account monitoring, credit score tracking, fraud monitoring, identity alerts, and protection advice.
Home Cyber Protection
This coverage provides payments for loss or damage resulting from cyberbullying or cyberstalking, or the cost of recovering home systems from a cyber (virus/malware) attack, cyber extortion, data breach, or other kind of online fraud.
If you occasionally rent out your home on a home-sharing network, this covers certain damages and injuries not included in the basic policy.
Personal Injury Coverage
The basic policy only covers physical bodily injury to others. This endorsement covers you if you hurt someone in nonphysical ways, such as slander or defamation.
Scheduled Personal Property Endorsement
This endorsement allows you to protect valuable items that you specifically list such as a wedding ring (the amount of coverage should equal the price it would cost to replace the item). The basic policy typically does not fully cover these types of items. Usually No deductible applies to this coverage.
Scheduled Jewelry-Agreed Amount Coverage
This endorsement allows you to specify the amount of insurance that we will pay if a listed piece of jewelry is lost or damaged. You may list multiple items of jewelry.
Scheduled Personal Property Blanket Coverage
This endorsement allows you to protect valuable items with an overall limit of coverage rather than scheduling each item individually. The base policy typically does not fully cover these types of items.
Special Computer Coverage
This provides additional coverage for computer hardware, software and related equipment, beyond the modest amount of insurance in the basic policy.
The basic policy does not cover damage from earthquakes. Add this endorsement to cover damage to your home caused by an earthquake.
Equipment Breakdown or Home Systems Protection
If home equipment like central air conditioning, a furnace or a stove breaks down due to a mechanical or electrical failure, this endorsement will pay to repair or replace those systems, subject to the policy deductible.
Limited Water Back-Up & Sump Pump Failure
The basic policy does not generally cover damage from blocked drain pipes or sump pump failure. If your home is damaged by a water or sewer back-up, this endorsement will pay for related home repairs.
Service Lines Coverage
If a service line to your house such as a sewage pipe or electrical connection fails, the utility company may not pay to fix it. This endorsement provides coverage for repairing the service lines between your house and the street.
Additional Residence Rented to Others
This endorsement extends liability coverage to other properties you may rent to others.
Other Insured Location Occupied by Insured
If you own property at another location, this endorsement covers you for liability and medical expenses at that property, which may not be covered by that property's insurance.
Structures Rented to Others Residence Premises
This endorsement provides coverage if you rent part of your property to others; a basic policy does not cover that structure. For example, it would cover a detached garage which has an apartment over it that you rent out.
This endorsement provides coverage for injuries or property damage that occur related to a business in which you are an employee of somebody else. The coverage does not apply if you own or control the business.
Credit Card, EFT, Forgery & Counterfeit Money
This increases your coverage for charges resulting from the theft of your credit or debit card, a forged check or acceptance of counterfeit money. The basic policy may only cover up to $500 for these losses.
Escaped Liquid Fuel Liability Buyback
This endorsement provides liability coverage for injuries and damages to other people's property resulting from a fuel spill contained within the insured property.
Limited Fungi, Wet or Dry Rot, or Bacteria
The basic policy does not generally cover mold damage. If your home is damaged by mold, this endorsement will pay for related home repairs. Most New Jersey H03 policies give a minimum of $10,000 for Section I - Property Coverage Limit of Liability.
Other Structures on the Residence Premise
This increases coverage for detached structures on the property beyond what the basic policy covers. For example, it could cover a large finished barn.
Specific Structures Away from the Residence Premise
This endorsement covers structures not on your property but used with your property, like a garage or boat dock.
Permitted Incidental Occupancies Residence Premises
This endorsement covers injuries and property damage that occur in your home or a detached structure (like a garage) when you have an incidental in-home business. The basic policy does not cover losses if they are related to an in-home business.
Refrigerated Property Coverage
This endorsement provides an amount, such as $500 of coverage minus a deductible for refrigerated items that spoil as a result of a power outage.
Loss Assessment Coverage
This provides additional coverage for an assessment from a building or homeowners association related to an insurance loss.
This provides coverage for injuries or property damage caused by a watercraft that is listed in the endorsement.
This provides for injuries or property damage related to the use of a snowmobile listed in the endorsement.
This endorsement provides personal property and liability coverage for a significant other who has resided continuously with you for a set period of time prior to the start date of this coverage.
Pet Injury Coverage
This coverage provides for veterinary care or burial expense if a cat or dog is injured or killed as the result of a covered loss. Coverage will have a maximum limit amount ,i.e, $500.
Increased Limits of Business Property
This endorsement increases the amount of coverage for "business" personal property, such as a laptop from work.
The basic policy does not cover damage to your home from sinkholes. This endorsement covers damage caused by sinkholes.
Theft of Personal Property in Dwelling Under Construction
If your home is under construction, this covers the theft of materials or supplies being used in the construction. The basic policy does not cover this type of loss.
This is a mandatory endorsement to provide residential workers compensation as required by the State of New Jersey. You have the option to increase the limits from $100,000 to $500,000
Hope this helps!
*The content contained in this blog is for informational purposes only. It should not be considered insurance advice since every client's needs and circumstances are different. Bergen Insurance Group, LLC makes no representation as to accuracy, completeness, currentness, suitability, or validity of any information on this site and will not be liable for any errors, omissions, or delays in this information or any losses, injuries, or damages arising from its display or use. All statements represent the sole opinion of the author and is provided on an as-is basis. For an actual description of all coverages, terms and conditions, refer to your insurance policy.