Surprise Issues That May Crop Up With Your Policy During the Pandemic
Despite the fact that the coronavirus pandemic is not going to damage or destroy your home like a tornado or hurricane it may have an impact on how you pay for the policy, coverage levels and how you make a claim.
Here are just a few issues that may crop up with your homeowners or renter’s policy during the pandemic:
Payment: There have been over 3.3 million jobless claims filed since the pandemic began and if you have been laid off, furloughed or seen your hours cut you may be struggling to cover your bills. Luckily, the majority of nationwide insurance companies are working with customers to help ease the pain. They often take these steps after natural disasters, working with policyholders who have had their entire life upended.
It varies by insurer but reduced payments, payment plans and temporary payment suspensions are all on the table from most insurers. In some states, the decision is being taken out of the insurance companies’ hands, California has recently called for a 60-day grace periods on insurance premiums.
As an example, Liberty Mutual states on their website, “We have empowered our employees to work with each individual customer to provide the personalized support you need. For auto and home insurance customers who are negatively impacted by coronavirus, we are extending payment dates and waiving fees.”
If you are having trouble with the cost of your homeowners insurance, call your insurer to see how they can help. It is also a good time to shop your home insurance coverage if your premiums have been headed up in recent years.
Shopping for an insurance policy can be done entirely online these days so shopping your coverage is a great way to kill some of your extra time and put a little coin back in your pocket. Get quotes from at least five insurers and make sure you are comparing apples to apples when it comes to coverage levels and deductibles.
Filing Claims
Unlike a major weather disaster there is not going to be a huge spike in claims that insurers have to worry about. However, due to social distancing inspections by an assessor and other functions that require an insurance company to send a person out may be delayed.
“Now in this case, it’s not so much that there’s a lot of claims occurring, but it’s simply the matter that there’s actually a physical impediment in terms of the claims being resolved or inspections being resolved,” said Fabio Faschi, property and casualty team lead at Policygenius, a national personal insurance marketplace in a recent Forbes article.
Insurers will be looking at workarounds during the pandemic which may include video conferences and video inspections. Exterior inspections of homes can usually continue as normal as long as social distance guidelines are followed. Many insurers have already streamlined the claims process and allow video and photos to suffice for simple claims. Larger claims or issues that involve significant assets may still require an in-home inspection.
Staying and Working at Home Could Lead to Claims
The fact that everyone is home all of the time these days could result in more property damage and liability claims. The more time we spend in our homes, the more likely it is for something to go wrong or malfunction, leading to a property damage claim.
The bigger aspect of increased claims relates to liability claims. You may be getting more and more things delivered and every time a delivery person comes onto your property there is a risk. If they slip on a snowy sidewalk or trip over a toy your child left outside you could find yourself on the wrong side of a lawsuit.
The liability portion of your homeowners insurance steps up to cover the medical bills or legal costs for anyone that was injured on your property. This covers slips, falls, and even dog bites up to your coverage limits.
A standard homeowners policy comes with a minimum of $100,000 in liability coverage but most experts recommend upping your liability coverage to at least $300,000 and if you have a significant amount of assets you should consider pushing it up to $500,000.
An umbrella policy is an excellent way to up your liability protection even further. These policies kick in when the coverage limits of your homeowners insurance has been used up. They are sold in $1 million increments and very affordable. While prices can vary, it is usually possible to buy $1 million in umbrella coverage for $200 to $300 a year.