What you should know about the limitations of home insurance

The reach of protections of home insurance has certain limitations that you should understand before signing a contract.

Policyholders should be aware that home insurance has limitations. Even if one subscribes to a comprehensive insurance policy, this coverage does not cover all risks. The capital paid as reimbursement in the case of a disaster is limited. In the case of a burglary, valuables such as works of art, jewellery and precious stones, as well as some professional equipment, are not compensated at fair prices as compared to other personal property.

The limit of home insurance also includes certain exclusions. The circumstances, the specifics of the insured or of the house, which are not part of the terms of the contract, are de facto, excluded from any compensation. Thus, a theft warranty does not cover theft of cash. Certain benefits are also limited by their duration: child care as part of warranty support, can last only two days in the case of hospitalization.

For some objects of value, the home insurance limitations are specified in the contract. Included are, among other objects: furs, collections, cash, gold ingots or boats. If the agreement specifies a warranty on these valuables, the policyholder is insured against loss or damage of a maximum amount in terms of the contract. In cases where the insured believes the coverage is inadequate, it is possible to take an addendum, to increase the maximum payment initially foreseen. Therefore, one must inquire with insurance advisors before any negotiations.

The insurance contract generally consists of two documents. One contains the Terms and Conditions, which stipulates all the terms applicable to all warranties covered by the company. The other covers the specific provisions, mentioning the specific terms of the contract. It is this latter document that is presented to the client for signing. However, the limitations of the home insurance are not specified. Before any ratification, the policyholder must request, from the insurer, a copy of the general conditions and ensure the understanding of all limitations that reduce the scope of the insurance guarantees.

Gerard Mihranyan

Par , le Tuesday 5 February 2013

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