Standard homeowners insurance policies are designed to cover sudden, accidental events. They typically exclude damage caused by flooding (rising water from outside sources) and earth movements (earthquakes, sinkholes, and landslides). To protect against these specific perils, homeowners must purchase separate policies or policy endorsements.
Many homeowners policies cover damage caused by "just about anything," unless specifically excluded. Most catastrophes are covered. For example, wind damage from hurricanes or tornadoes is covered as a windstorm peril. But, flood damage and earthquake damage are NOT covered by a standard homeowners policy.
Damage resulting from the shifting or sinking of land, such as earthquakes, landslides, mudslides, sinkholes, subsidence, or volcanic tremors, is typically excluded.
Typical homeowners insurance policies offer coverage for damage caused by fires, lightning strikes, windstorms and hail. But, it's important to know that not all natural disasters are covered by homeowners insurance. For example, damage caused by earthquakes and floods are not typically covered by homeowners insurance.
Damage caused by most disasters is covered but there are exceptions. Standard homeowners policies do not cover flooding, earthquakes or poor maintenance. Flood coverage is provided by the federal government's National Flood Insurance Program, although it is purchased from an insurance agent.
Standard homeowners insurance policies typically exclude catastrophic events and maintenance-related issues. The most common perils not covered include:
Commonly excluded homeowners insurance situations include flooding, earthquakes,, and damage from lack of maintenance or wear and tear. Policies usually do not cover pests, mold, intentional damage, or sewer backups without added endorsements. Standard policies also rarely cover high-value items, home business liability, or rebuilding to new, stricter building codes.
Avoid insuring your home for its real estate market value instead of its rebuild cost. Never rely on a standard policy for major natural disasters (like floods or earthquakes), high-value items (jewelry, art), or damage caused by regular wear, tear, and neglect.
5 Things That Aren't Covered By Home Insurance
Most standard homeowners insurance policies do not cover damage from floods, earthquakes, sinkholes, or sewer backups, nor do they cover routine maintenance issues like wear and tear, pest infestations, or mold. Neglect, intentional damage, and damage to high-value items (like jewelry/art) often require separate coverage or endorsements.
A home insurance exclusion is a risk not covered by your policy. Common homeowners insurance exclusions are floods, earthquakes, and lack of maintenance.
Homeowners insurance typically covers damage to your home’s physical structure, your personal belongings, liability for accidents on your property, and temporary living expenses if your home becomes unlivable.
There is a fine line that determines whether a policy covers bat damage. Most policies state that they do not cover damage caused by birds, vermin, rodents or insects, but bats don't technically fall into any of these categories. Some policies specify that they don't cover bat damage.
The Own Damage insurance excludes coverage for liabilities involving third parties, including injuries, death, or property damages to the third party.
An insurance exclusion is a specific provision in a policy that eliminates coverage for certain risks, events, or conditions. Put simply, it dictates what your plan will not cover. Exclusions vary by provider and policy, but several common types recur across different branches of insurance.
Coverage for water damage depends on the situation and the source. If the damage is sudden, accidental, and comes from inside your home, you may be protected with a standard homeowners insurance policy. However, you typically won't be covered if the water damage is caused by outside flooding or a neglected repair.
Homeowners insurance typically doesn't cover damage from floods, earthquakes, landslides, sinkholes, wear and tear, animals or insects, or water backing up from sewers, drains, septic tanks and sump pumps. Purchasing homeowners insurance is a relatively affordable way to protect what is likely your biggest investment.
Exclusions in Home Insurance Policy
The exclusions in most of the home insurance policies are: Wear and tear or loss because of depreciation. Cash loss. Act of any foreign country or war.
Homeowners insurance perils are unpredictable events that cause damage to your property. Home insurance typically covers 16 named perils. Commonly excluded perils from home insurance policies include earthquakes, floods, sinkholes, certain types of water damage, wear and tear and intentional damage.
Homeowners insurance is not intended to cover every type of loss. There are some notable exclusions that homeowners should be aware of, such as floods, earthquakes, landslides, mudslides and sinkholes.
Common exclusions in life insurance policies include:
Some examples of often-excluded services include cosmetic surgery, vasectomies, weight-loss drugs and bariatric surgery, abortion, acupuncture, dental care on a health insurance policy, etc. But some policies cover services that others exclude, so there's variation from one plan to another.
Dave Ramsey emphasizes that homeowners insurance protects you from sudden, catastrophic financial ruin, not routine maintenance or natural disasters. A solid, recommended policy should offer Guaranteed Replacement Cost to fully rebuild your home.
Standard homeowner's insurance policies will not cover damage from natural disasters like floods and earthquakes. They also exclude routine maintenance issues, such as general wear and tear, mold, and pest infestations.
Allstate denied the most claims according to a Weiss Ratings study of 2024 data, with 50.9% of claims closed without payment by Allstate Vehicle & Property Insurance Co. and Allstate Insurance Co. at 49.8%. It was followed closely by USAA at 49.5%.