Understanding Homeowners Insurance Terms: Inclusions vs Exclusions 

Understanding Homeowners Insurance Terms: Inclusions vs Exclusions 

A common misconception about homeowners insurance is that once you sign on the dotted line, you’re covered – no ifs, ands, or buts. While a standard policy does provide you with protection for many of the most common causes of loss, it doesn’t cover every eventuality. Knowing what is included and what is excluded in your policy can help you decide if you need supplemental coverage to provide comprehensive protection and better manage your risks.

Inclusions

If your homeowners insurance policy explicitly says coverage is included, you can have some peace of mind about any potential losses. However, it’s not just coverage for specific items that is in question. It’s important to understand that most insurance policies cover claims based on the cause of the loss first, and the type of loss second.

For example, a loss could occur because of fire, a hurricane, or a flood. Your living room suite may or may not be covered depending on your policy terms and what caused the damage.

• In most cases, damage caused by a fire would be covered under a standard HO3 homeowners policy, and your regular “All Other Perils” deductible would apply. 
• Damage caused by a hurricane would also be covered, but your hurricane deductible would apply, which could be either a percentage-based deductible or a flat-rate deductible. 
• Damage caused by flood would not be covered under your HO3 policy, but if you had supplemental flood coverage, it could be covered under that policy.
• If your living room suite was extremely expensive, it might only be covered to a certain limit under your HO3 policy, but could be covered fully under an endorsement or policy rider that provides expanded coverage.

Exclusions

Many policies will specifically exclude or limit coverage by placing verbiage in the policy language. Common exclusions or limitations found in many Florida policies are:

• Damaged or destroyed pool enclosures or screens
• Damaged or destroyed outbuildings or detached structures 
• Damage caused by wind-driven rain if there is no hole in the roof or wall
• Damage caused by a backed-up sewer or failed sump-pump
• Mysterious loss of items such as jewelry or silverware

Olympus Insurance specifically lists many inclusions on HO3 and other policies that are traditionally excluded from other policies. Other normally excluded coverages can be obtained by adding an endorsement such as Spartan Enhanced Coverage.

Ask your insurance agent about options such as fixed hurricane deductibles instead of percentage based, to minimize your liability in case of a named storm. They can help advise you about how you can best customize your policy to provide the best coverage possible.

About Olympus Insurance Company

Headquartered in Palm Beach Gardens, FL and founded in 2007, Olympus Insurance Company specializes in Florida property insurance. Through its independent agency force, Olympus insures $40 billion worth of residential and investment property including homes, condos, rental property, and valuable personal property, with umbrella coverage and Spartan Enhanced Coverage available. Coverage for individual risks up to $5 million in total insured value is provided on one of the most comprehensive coverage forms in the industry.

For more information, visit olympusinsurance.com.

This article is for informational purposes only and does not form a part of, replace, change or amend any terms, conditions, provisions or language within your Olympus Insurance policy. We encourage you to read your entire policy.