Most home buyers don’t really understand their homeowner’s policy when purchasing it. Usually, you go to an insurance agent they fill out your application and you sign. However, when you end up having a property insurance claim, it is important to understand what kind of policy you have. The type of Policy you purchased will affect whether your claim is covered. There are several types of policies, one of the more popular or more common policies is an “all risk” policy also, commonly referred to as an “HO3” policy.

Purchasing an “All –Risk” Policy

‘All-Risk” policies usually have more comprehensive coverage, however, they do not really cover “all risks.” Generally, all-risk policies cover damage to the property as a result of ‘accidental direct physical loss.’ Despite this, the most important part of the policy is actually the exclusions. Although damage from an accidental physical loss is covered, there will be certain causes of damage or damage that are excluded.  Some of the most commonly excluded damage is damage that is a result of “wear and tear”, old age, deterioration, repeated leakage and seepage and water damage that has been continuous for more than 14 days.

Don’t Let The Insurance Company Dictate Your Compensation

Many insurance companies repeatedly use these terms to deny claims, so it is very important to document new damage and to always prevent further damage and if you need to file a property insurance claim always try and report as soon as possible, the longer you wait the more reasons the insurance company will find to deny your claim.

Generally, an all- risk policy covers most damage unless it is excluded, in layman terms.

This blog is general information, please remember that each policy is different and you must read it to know what is covered and what is excluded.

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