When it comes to protecting one of your biggest investments — your home — misinformation about insurance can leave households unprepared for the unexpected.
From what’s actually covered to when you can buy a policy, many homeowners are surprised to learn the truth only after it’s too late.
Here are the real facts about five of the most common myths about home insurance.
1. Home Insurance Protects Against All Types of Damage
Home insurance does offer broad coverage, but it’s not a catch-all safety net. Standard policies are designed to cover certain unexpected events — while leaving others out.
Some of the most common situations a standard policy covers include:
- Fire or lightning
- Windstorms or hail
- Explosions
- Vandalism or theft
- Falling objects
- Certain water damage (such as busted pipes)
These protections are designed to help homeowners recover from sudden losses. On the other hand, some common exclusions include:
- Flooding
- Earthquakes
- Maintenance issues (mold, pests, wear and tear, etc.)
- Sewage backups
In addition to these exclusions, living in a high-risk area can bring extra challenges. Insurers may limit coverage, exclude certain damages like wildfires or increase costs with specific requirements.
2. Buying Home Insurance Right Before a Storm Ensures Coverage
Some believe they can secure coverage at the last minute, just before severe weather. In reality, most insurance companies often establish binding restrictions as soon as a natural disaster is forecasted.
This means:
- New policies can’t be issued
- Coverage can’t be increased
- Changes won’t take effect until after the storm passes.
That’s why it’s better to take a proactive approach to ensuring your coverage is in place well before a storm is on the horizon.
3. Home Insurance Covers 100% of My Home’s Value
It’s easy to believe that your policy matches the full market value of your home — but that’s not how coverage works. Instead, it covers the cost to rebuild your home entirely from scratch if it were to be damaged or destroyed.
It’s important to understand the difference between market value and rebuild cost.
Your market value includes the location, land, and housing demand in your area, while your rebuild cost looks at the construction expenses, such as labor, materials, and specific building codes.
Knowing the difference helps you set realistic expectations for your policy.
4. Home Insurance Covers All of My Belongings
Home insurance does cover personal belongings, but only up to certain limits. Standard policies include personal property coverage, which helps reimburse you if items are stolen or damaged.
However, most policies place a sub-limit on higher-value items such as jewelry, electronics, and collectibles.
That’s why it’s important to understand what your policy includes and where the specific limits apply. Yet about 7.4 percent — roughly 6.1 million households — lack homeowners insurance altogether, leaving $1.6 trillion in property value unprotected.
5. My House is Covered if I Go On Vacation
Leaving your home unattended for a vacation does carry some risk of damage or theft, and some insurers may limit coverage if a property is unoccupied for too long. For example, if a pipe bursts while you’re away and no one notices, some insurers may deny coverage for the damage if the home was left unattended too long.
That’s why some insurers recommend precautionary measures, like having someone check on your property while you’re away.
These steps can help prevent issues such as unnoticed water leaks, storm damage or break-ins that could go unchecked.
Think Ahead with the Right Home Insurance Coverage
Understanding the truth behind home insurance myths isn’t about busting misinformation — it’s about empowering yourself to make educated decisions for your home, your finances, and peace of mind.
Knowing what is and isn’t covered, and planning accordingly, can make a world of difference. We’re here to help you compare policies that specifically meet your needs and budget.
Start comparing home insurance options and get a personalized quote today!