Home Insurance Myths vs Facts

Home Insurance Myths vs Facts

- in Home, News, Personal Lines

Home insurance is a very important form of insurance not only for landlords but also tenants who would wish to insure their household contents. It is however saddening that year after year a considerable percentage of families lose their homes and contents therein due to a number of insurable perils.

Lets us now look at the some of the top myths that hinder people from getting home insurance.

Myths 1: Home insurance is excessively expensive since property values are high.

Fact: Insurance works on the law of large numbers. This doctrine simply means that a large number of people contribute very little amounts towards a pool. Thus the losses that will occur fall lightly on a large number of people rather than heavily on one individual. Thus premiums which are charged are surprisingly low.

Myth 2: If I injure someone on my driveway, the liability coverage in my homeowner’s policy will take care of the loss.

Fact: Most people think of the liability coverage under the homeowner’s policy as applying to someone who is injured on their property. The coverage is much broader than that, including things like your dog biting some¬one or someone claiming an injury or property damage caused by your actions. Liability arising out of the use of a motorized vehicle, however, is not generally covered. You would need to buy specific coverage.

Myth 3: If my home is flooded my homeowner’s policy will not cover it.

Fact: Unlike in other countries, homeowners policies in Zimbabwe include loss or damage caused by storm or flood .Thus you don’t necessarily have to buy a separate policy to cover yourself against losses arising out of flood damage.

Myth 4. If I file a claim, my premiums will increase.

Fact: Insurance companies will review your claims history, but this is  only one factor in determining insurance rates. If you are repeatedly filing claims for items that are only slightly more than your deductible, it may increase your rates.

Myth 5: I can insure my home for what it’s worth regardless of what it would cost to replace it.

Fact: Insurance coverage on your home should be based on “replacement value” (e.g., what it would cost to replace your home in the event of a total loss.) We at Capitol Insurance brokers can help you determine the amount of homeowner’s insurance coverage you require.

Myth 6: I do not have a mortgage so I do not need insurance.

Fact: If you purchase a home for cash, you may not be required to have insurance. When a lender does not require you to have insurance (or you have no lender), it still makes sense to have a homeowners insurance policy.  It is not sensible to risk the loss of your home by not having insurance.

In spite of all of the myths surrounding homeowners insurance, you should always check with us before making a decision on what coverage is best for you.

For step by step simplified home insurance cover please call Capitol Insurance Brokers.


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