Home insurance is designed to protect your home from many common risks. But a standard policy (one without add-on coverage) doesn’t cover everything. It often has limits some homeowners may not know about.

Understanding what your policy doesn’t cover is just as important as knowing what it does. The good news is that many gaps can be addressed with additional coverage options.

In this article, we’ll walk through 10 common situations that standard home insurance policies typically won’t cover, and what you can do to stay protected.

Key takeaways

Because standard homeowners insurance policies don’t cover every type of damage, it’s important to understand what isn’t covered. These are commonly referred to as “exclusions.”

10 common things your standard homeowners policy^** likely won’t cover (exclusions):

• Flood
• Water back up
• Earthquakes
• Sinkholes
• Landslides
• Termites
• Rodents
• Certain dog breeds
• Home businesses
• Mold

^** = Standard policies are defined as policies that do not have any additional endorsements or coverage on the policy.

Certain Water Damage

Water damage is one of the more complex areas of your home insurance policy. Some water damage may be covered, but certain types of water damage are not.

Situations where water damage won’t be covered by a standard policy include the following:

Flooding

A flood is defined as an excess of water on land that is normally dry. From heavy rains, overflowing rivers, or melting snow, floods can happen anywhere. Damage done by flooding is not covered by standard policies.

To cover flood damage, you’ll need a separate flood insurance policy. Flood insurance policies typically only cover the damage done by flooding. These policies don’t cover temporary housing if your home is made unlivable by flood damage.

Water Backup

Some water damage may happen when water overflows from sewers, drains, or a sump pump failure. This is typically called “water backup,” and damage to your home from these situations isn’t covered either.

Just like with flood damage, this type of loss may be covered if you have the right coverage. The good news is you won’t have to acquire a new policy. Water backup coverage is an optional endorsement you can add to your policy to help in these situations, given availability (it may not be provided by every carrier or be available in your area).

This coverage only pays for the resulting damage. For example, if a sump pump failure causes water backup, the damage may be covered, but repairing the sump pump itself is typically not.

Even if you do have this coverage, you still need to understand what it includes. Water backup coverage only applies to specific types of overflows. Groundwater, broken service lines, burst pipes, and flooding are not covered under water backup.

Earth Movement

Natural disasters caused by earth movement typically aren’t covered by standard policies.

Earthquakes

Because earthquakes can cause widespread damage, standard policies are not equipped with earthquake protection.

Earthquake coverage may come as an entirely separate policy (similar to flood insurance) or an endorsement you can add to your existing policy. What’s available depends on your location and insurance company.

For earthquake coverage to take effect, the earthquake must be the direct cause of damage to your property. Indirect damage (such as fire or burst pipes) may be covered by your standard policy.

Earthquakes can occur in all 50 states, though the level of risk varies by location.

Sinkholes and Landslides

Sinkholes happen when water dissolves sediment and rock underneath bedrock, making the ground unstable. This causes the bedrock to break and sink inward, forming a hole.

Landslides refer to earth, rock, or other debris that fall down a slope, caused by a variety of reasons.

While standard policies won’t cover damage that was the result of either of these events, don’t stress. You can be protected from sinkholes and landslides with additional endorsements on your policy, though you may need a separate policy depending on availability.

Pests & Animals

Certain animals can cause damage to your home, or injury to others on your property. It’s important to be aware of what kinds of animals won’t be covered by your policy.

Pests (Termites & Rodents)

Because termites eat away at the structure of your home, the damage usually happens over time. So, termites are not covered by insurance.

Termite damage is often considered the responsibility of the homeowner. Making sure your home is termite-free is considered part of regular home maintenance.

Insurance is designed to cover sudden, unexpected loss, not an ongoing maintenance issue.

In a similar way, rodents can cause gradual damage as well, which again falls under home maintenance. Because of this, damage done by rodents likely won’t be covered.

Certain dog breeds

When it comes to dog breeds, insurance companies need to know what kind of dog you have. However, in most cases, this isn’t because of any damage threat they pose. It’s for liability.

Part of your home insurance policy accounts for injuries that occur on your property. If you, a part of your home, or pets inflict bodily harm on someone visiting your property, liability may help pay for the resulting costs (up to your policy’s limits).

However, with certain dog breeds, some carriers may have restricted breeds. This means that if you own a dog from this list, your carrier may deny coverage or, in more extreme cases, cancel your policy.

Breeds that may appear on restricted lists include:

• Pit bulls
• German shepherds
• Dobermans

These restrictions vary by carrier, so it’s important to confirm with your insurance company or agent what’s covered.

Home businesses

Generally speaking, home businesses are not covered by a standard home insurance policy. Some companies may offer coverage for businesses, but It's often limited or minimal.

If you run a home business, there are ways to get the protection you need. Some carriers may offer endorsements, but not all do.

The best recommendation is to seek an additional business policy. If you run a smaller business (anywhere from two to three employees), an in-home business policy may be sufficient.

Larger businesses that fall in small-to-mid-size operations may require a businessowners policy (BOP).

It’s important to note that even these policies have their limitations (such as workers’ compensation or health insurance). Be sure to discuss your needs thoroughly with your insurance carrier or agent.

Mold

For the most part, mold is not covered by a standard home insurance policy. It may only be covered if it’s caused by water damage your policy already covers, such as accidental discharge or overflow of water (not water backup).

Flood insurance policies only cover damage that resulted from a flood. Even if mold develops after your home was flooded, it typically will not be covered.

Partially covered by standard policies

Standard home insurance policies can sometimes offer limited or partial coverage for certain scenarios.

It can be important to understand when you may need to seek additional coverage outside of standard limits.

High-Value Items

Home insurance policies consider the following high-value items:

• Jewelry
• Watches
• Art & art collections
• Antiques
• Specialized equipment
• Certain electronic devices
• Luxury goods (furs, designer handbags, high-end clothing)

There may be more that fit into this category, but these are some of the more common items.

Standard policies may cover high-value items, but these items have coverage limits (also called sublimits).

To have these items protected for their appraised value, you may seek other policies or add a scheduled personal property endorsement to your policy.

Other Structures

Your home insurance includes dwelling coverage, which is designed to protect your home’s physical structure.

Other structures coverage (which protects detached garages, sheds, fences, and gazebos) is based on a percentage of your dwelling limit, usually 10%.

You may have the option to increase your limit up to 20 or 30%, but that typically comes with an increase in your premium. Alternatively, you could increase your dwelling coverage to accommodate your detached structures.

Like all other scenarios in this article, there may be additional endorsements or separate policies you could pursue to add more protection.

Final thoughts

Standard home insurance policies are designed to cover common risks. Because of this, they have limits. The good news is that many of these gaps can be addressed through endorsements or separate policies.

Home insurance can be tailored to fit your specific needs, especially when you understand where standard coverage falls short.

That’s one of the benefits of working with Goosehead. Our agents work with you to find coverage gaps and build a policy that fits your needs.

You can contact one of our agents by reaching out through our website or calling at (833) 779-4090.