GOOD READS

Are You a Bigger Insurance Risk Than You Think?

You're a good neighbor. You keep your sidewalks clear, your trees trimmed, your dog on the leash, and your pool gate locked--all steps meant to keep your family and friends safe and your insurance costs down.

But even the most conscientious homeowners may trigger insurance issues and not even know it.

"Consumers need to keep in mind that insurance products were created to replace catastrophic loss," says Jeff McCarthy, an agent with Harrington Insurance Agency in Woburn, Mass. "It's not quite so simple as bumping up your policy here and there to cover a trampoline, for instance. It's not like getting a new car and adding air conditioning or GPS. Your overall insurance risk profile might be elevated, and that comes at a cost."

[See 50 Ways to Improve Your Finances in 2012.]

"It doesn't mean you're uninsurable. There is always a carrier, such as a more-expensive state insurance pool or a specialty insurer that will take on your risk, but you pay for it," McCarthy says.

When your homeowners, condo, or renter's policy comes up for renewal, the insurer typically sends a questionnaire that asks about hazards. Homeowners have a responsibility to report their current status, detailing any changes. Failing to keep policies up to date can risk a rejected claim or a dropped policy. Many consumers go for multipolicy discounts between homeowners and auto insurance, so putting your homeowners' policy in jeopardy could prompt having to change auto insurers.

Although regulation varies by state, some of the biggest culprits behind added insurance costs include:

Swings, gyms, trampolines, and other backyard equipment. They're a staple of childhood and quite common. But they're still often an added insurance liability cost because of the risk that a child could fall or suffer an injury while on your property. The equipment make and model can affect the price of a policy, so do some research to find which equipment is highly rated by the insurance industry.

[See What Type of Life Insurance Do I Need?]

Pool, sauna, hot tub, and fireplaces. Owning a pool, sauna, or hot tub can increase the cost of your home insurance policy due to increased liability as well as greater property value. Appropriate fencing, security features, and other measures not only save lives, but also reduce the cost of insurance. Often homeowners take steps to keep unexpected guests out of the pool, but even carefully patrolled parties carry the risk of an unexpected accident. In general, remember that it costs money to insure these watery additions to the patio and yard, so make sure your budget can handle it. Outdoor fireplaces and fire pits have gained in popularity in recent years; they may also not be covered under a standard homeowners' policy. Research ahead of purchase is important.

Dog breeds. The loyal family dog may simply be a gentle giant, but it likely won't matter to the underwriters if the pooch fits a certain profile. Virtually no regular insurance company will cover you if you have a Doberman pinscher, German shepherd, pit bull, or Rottweiler. The second category encompasses borderline breeds. A certain breed--a husky, for instance--may be okay with one insurance company but not with another. If you have a certificate showing that the dog has gotten obedience training, it may help. Among the borderline breeds are supersized varieties such as the English bullmastiff and Great Dane. According to insurance industry rules, that's because a big dog, although unaggressive, may playfully jump on someone and accidently knock him or her down and cause an injury.

[See Do You Need Liability Insurance?]

There are other not-so-obvious homeowner insurance responsibilities to consider. McCarthy says homeowners often neglect to update policies after major renovations. The square footage increase is the primary reason that a bigger policy is needed. Should a tree fall on the new addition that the insurer doesn't know about, the homeowner may face some problems.

Homeowners should also be careful that any repairman, especially electrical or plumbing contractors, are insured. Spreading the risk to the service provider is important should their work malfunction in some way and harm the home.

Another issue gaining greater attention is the fact that more home-based businesses have sprouted up in recent years. Consultants, for examples, may not be incorporated as a business but if they receive clients with any frequency, they should come clean with their insurance agency. One slip on an icy step and a home-based business could be shuttered by a lawsuit.

Twitter: @USNewsMoney



More From US News & World Report

Quiz: How well do you know India's economy?

Question 1

Which of these products is India the world's largest producer of?

Poll Choice Options
  • Wheat
  • Rice
  • Milk
1
2
3
4
5
6
7
8
9
10

Latest News

  • Strides surges as Bangalore plant remains U.S. FDA compliant

    Reuters Market Eye - Strides Arcolab surges 6.3 percent after the drugmaker said on Friday its oral drug manufacturing facility in Bangalore continues to maintain compliance with the manufacturing standards of the U.S. health regulator. "U.S. FDA recently inspected this facility as part of GMP compliance audit and raised Form 483 (inspection observations) during the Dec 2013 inspection (which has now been satisfactorily closed)," Macquarie said in a note to its clients. This is a key positive …

  • French companies to continue investing around $1 bn in India

    New Delhi, April 25 (IANS) Expressing confidence in the Indian economy, French companies that are engaged in India will continue to annually invest nearly $1 billion here as they see long-term future in the country's growth potential, a top diplomat has said. "I expect the investment trend of nearly a billion dollars to continue as the French companies are here for the long-term and are setting up their base here and expanding production," French Ambassador François Richier told IANS in an …

  • `India needs over 26,000 independent directors'

    Kochi, April 25 (IANS) India needs over 26,000 independent directors and around 2,500 women directors to fill the boards of companies across the country, an official said here Friday. Lt. Gen (Retd) J.S. Ahluwalia, president of the Institute of Directors, said that despite a handful of high profile female Indian entrepreneurs, the proportion of female directors is a meagre 5.2 percent, which is even below the developing world percentage of 7.2 percent. Ahluwalia's statement comes at a time …

  • India's growth prospects dim regardless of election outcome - Reuters  …

    Prospects for a strong economic rebound in India are dim as industry remains weak, and although a business-friendly opposition party looks likely to form a new government, its ability to pass sweeping reforms is in doubt, a Reuters poll showed. An anticipated victory for the Bharatiya Janata Party's (BJP) at the conclusion next month of an ongoing election in the world's largest democracy has pushed India's stock market to a record high. Anubhuti Sahay, senior economist at Standard Chartered …

  • World shares, dollar struggle on Ukraine anxiety

    Heightened tension in Ukraine pushed world shares lower and lifted safe-haven European bonds on Friday, taking the shine off what looked set to be an earnings and M&A-driven week of gains for European and U.S. stocks. Trouble in Ukraine escalated after Ukrainian forces killed up to five pro-Russia separatists on Thursday and Russia conducted military drills near the border, raising fears it was gearing up to invade. European shares tumbled 0.5 percent in early trading as concerns also rose …

IN-DEPTH ANALYSIS & INTERVIEWS

  • Too good to be true?

    Developers are offering lucrative buyback schemes. But such promises may not be always kept. …

  • Leaderspeak with Vikram Limaye

    Vikram Limaye MD & CEO, IDFC Ltd shares many firsts from his life. …

  • The Greening of the House of Tatas

    How a dedicated team converted a 90-year-old heritage structure into a benchmark for environment-friendly buildings. …

  • Appy Voting

    Mobile and online apps, seeking to inform or influence voters, have been more active than ever before in this election. …

  • In the crosshairs

    Why the future of FDI in multi-brand retail looks bleak after the polls. …

  • Deserving the honour

    How do the winners of the two new banking licences - microfinance lender Bandhan Financial Services and infra institution IDFC Ltd - measure up to the challenges of operating as full-fledged banks? …

  • A Samurai from Chandigarh

    Advertising veteran Sandeep Goyal is disarmingly frank as he recounts his years with Dentsu. …

MARKET MOVERS

  • Most Actives
    Most Actives
    NamePriceChange% Chg
    23.45-0.40-1.68%
    ASHOKLEY.BO
    16.46-0.06-0.36%
    UNITECH.BO
    128.90+8.50+7.06%
    FRL.BO
    75.80+3.50+4.84%
    HDIL.BO
    116.700.000.00%
    IDFCSL.BO
  • Price % Gainers
    Price % Gainers
    NamePriceChange% Chg
    12.56+2.05+19.51%
    BIBCL.BO
    548.40+82.40+17.68%
    STRIDES.BO
    31.95+4.10+14.72%
    STOREONE.BO
    261.45+31.40+13.65%
    VIVIMEDLABS.BO
    163.20+19.50+13.57%
    AGARIND.BO
  • Price % Losers
    Price % Losers
    NamePriceChange% Chg
    -10.95-100.00%
    4THGEN.BO
    -17.30-100.00%
    ALFAICA.BO
    -17.65-100.00%
    AMAL.BO
    -12.31-100.00%
    BORAX.BO
    -29.95-100.00%
    BRADYM.BO
  •  
    Recent Quotes
    Symbol Price Change % ChgChart 
    Your most recently viewed tickers will automatically show up here if you type a ticker in the "Enter symbol/company" at the bottom of this module.
    You need to enable your browser cookies to view your most recent quotes.
  • Recent Quotes News

    •  
      Sign-in to view quotes in your portfolios.