and safety code updates on costs. Many municipalities have stricter building and safety code requirements compared to the original construction of the home, adding thousands or even hundreds of thousands of dollars to the restoration expenses. Insurance policies often offer limited coverage for the increased costs resulting from ordinances and laws. In many cases, this coverage is limited to a percentage of the replacement cost coverage. While earthquakes often grab the headlines when it comes to ground movement, it is important to recognise that the ground can move for various reasons. Homeowners should not solely rely on earthquake coverage, as it only provides limited protection against damage caused by seismic activity. Earthquake policies generally exclude coverage for risks such as landslides, mudslides, rockslides, mine subsidence and sinkholes. To obtain coverage for these risks, seek out an earth movement insurance policy that provides broader coverage and protection against a wider range of perils. Earth movement coverage considers other causes of ground movement, such as landslides, sinkholes, or subsidence. These events can cause significant damage to properties and may not be covered under a standard earthquake policy. The risk of earthquakes is high in California, the Pacific Northwest and the New Madrid fault regions, but lower in other areas. However, there are still localised risks such as landslides, mine subsidence, sinkholes and ground movements. Oklahoma is unique as it experiences numerous smaller earthquakes due to fracking-related wastewater injection wells. Insurance coverage for Oklahoma earthquakes is limited, making policy definitions crucial. Insurance carriers struggle with assessing man-made risks in Oklahoma. Insureds in earthquake-prone areas should choose their earth movement coverage carefully to avoid coverage gaps or claim issues. They should review their policies to ensure coverage for both natural and man-made earth movements, such as the vibration of the earth due to construction occurring around their property, as some insurers may include or exclude this coverage explicitly. Thoroughly assessing the definitions and terms of their coverage is vital, especially for those with excess policies, to avoid discrepancies that could jeopardize their coverage. Insurance Policy Cancellations: A Changing Reality for Homeowners Homeowners are currently dealing with an unprecedented increase in policy cancellations and non-renewals. This is being driven by a succession of expensive claims within the community or state, leading insurers to make the tough choice of either discontinuing operations in certain geographic areas or terminating coverage for policyholders. Insurance companies consider various factors before cancelling a policy, and not all claims will automatically lead to policy cancellation. By neglecting to report a prior claim, homeowners are potentially jeopardizing their coverage and leaving themselves vulnerable in times of need. Insurance is meant to provide protection and peace of mind, but failing to disclose necessary information can ultimately hinder the purpose of having insurance. In the event that an insurance claim becomes necessary, homeowners who have a history of undisclosed claims may encounter significant obstacles. Insurance companies have the right to deny claims made for prior undisclosed incidents, which can leave homeowners responsible for covering the costs themselves. Failing to disclose prior claims can jeopardise coverage and leave homeowners vulnerable when they need it most. Homeowners frequently omit or fail to provide important details when filing a claim, due to the perception that this information might adversely affect the settlement process. However, holding back necessary information can ultimately weaken the intended outcome. Filing property damage claims can affect a homeowner’s eligibility for insurance. Insurance companies may reassess and potentially change the coverage and premiums, or even cancel the policy, based on the nature and frequency of claims. Homeowners can challenge these decisions by making adjustments, like modifying their property or insurance policy, to meet the company’s requirements and keep their coverage. Home Insurance Dilemma: When Coverage is Elusive The profitability of property insurance is compromised due to the rise in natural disasters, as the amount paid FEATURE OF THE MONTH 17 Homeowners are currently dealing with an unprecedented increase in policy cancellations and non-renewals.
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