Exclusions
All homeowners forms contain exclusions and limitations. Exclusions are causes of loss which are not covered by the insurance policy. The standard exclusions are losses due to:
- Enforcement of law or ordinance regulating construction, repair, or demolition
- Earth movement, including earthquake and mine subsidence
- Water damage, including flooding and overflow from a sump pump
- Power interruption that takes place off the residence premises
- The insured’s failure to save and preserve property after a loss, or to protect it from loss
- War
- Nuclear hazard
- Losses caused intentionally by the insured or by someone else at the insured’s direction
- Destruction, confiscation, or seizure of property by the government or a public authority
A homeowners insurance policy covers nearly all of your personal property in the event of a loss. Loss of personal property is paid on an actual cash value basis. This means that the amount of money a person can expect to receive is based on the cost to replace the item less depreciation. Nearly all personal property is covered, but there are some classes of property which are not covered. The following classes of property are specifically excluded:
- Animals, birds, or fish
- Motorized vehicles or aircraft, including equipment and accessories
- Property of boarders
- Personal property in an apartment held for rental by the insured
- Paper or electronic records containing business data, except for prerecorded programs available on the retail market
- Personal property rented to others off the residence premises
- Credit cards
- Hovercraft and parts
Special Limits
Certain classes of personal property have special limits of liability that are lower than the overall policy limits that apply to personal property. These coverage restrictions are designed to encourage insureds with personal property of especially high value or of a hard-to-value nature to insure this property on a specific basis with a policy endorsement. The following classes of property have special limits which vary between insurance companies.
- Money or related property, coins and precious metals (does not apply to tableware)
- Securities, manuscripts and other valuable paper property (includes the cost to research, replace or restore the information from the lost or damaged property)
- Watercraft, including trailers and equipment
- Trailers not used with watercraft
- Property on the residence premises used for business purposes
- Property away from the residence premises used for business purposes
- Electronic apparatus while it is in, on or away from a motor vehicle (such as a car phone or portable CD player) provided the apparatus can be operated by both the vehicle’s power and other power sources
- Electronic apparatus and accessories used primarily for business while away from the residence premises and not in or on a motor vehicle
Theft
The theft peril includes loss of property from a known place when it is likely that the property has been stolen. It also includes attempted theft. Note: For an insurance company to pay for a theft loss, there must be clear signs of forced entry. In regard to theft, the following scenarios are not covered:
- Theft from a dwelling under construction
- Theft from a portion of the premises that the insured rents out
- Theft of watercraft or equipment, trailers or campers while off the premises
- Mysterious disappearance
The following classes of property have special limits that are only applied to theft.
- Jewelry, watches, furs, and precious and semi-precious stones
- Silverware, goldware or pewterware
- Firearms