Your Homeowner's Policy Doesn't Cover Everything

Breaking down the claim game from the attorneys who play it

By Marilyn Stone | Reviewed by Canaan Suitt, J.D. | Last updated on October 10, 2023 Featuring practical insights from contributing attorneys Pamela A. Okano and Paul J. Lawrence

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You awaken at midnight to the sounds of a howling windstorm—rain beating against your bedroom window and tree limbs snapping in the backyard. It’s disconcerting, to be sure, but you take comfort knowing you have an “all-risk” homeowners insurance policy.

You might be surprised at what an “all-risk” doesn’t cover.

Misconceptions About What a Home Insurance Policy Covers

“There’s a misconception that if you get full homeowners insurance coverage, you’re covered for everything,” says Pamela Okano, an attorney with Seattle’s Reed McClure. “There are always going to be things that aren’t covered.”

“People tend to take their homeowners insurance for granted,” says attorney Paul Lawrence, with Preston Gates & Ellis in Seattle. “It’s just a bunch of paper that comes in the mail each year. We often don’t pay attention to the policy until there’s a problem.”

Policies touted as all-risk tend to lull homebuyers into complacency, but Lawrence warns that the all-risk policy is not what it used to be.

There’s a misconception that if you get full homeowners insurance coverage, you’re covered for everything. There are always going to be things that aren’t covered… Homeowners should talk with different agents and ask specific questions about what policies cover.

Pamela A. Okano

What Homeowners Insurance Covers Has Narrowed

“The scope of exclusions tends to grow over time as new issues arise, such as mold,” says Lawrence. “Then companies start limiting their exposure.”

Common exclusions to standard home insurance policies include:

  • Construction defects
  • Sinkholes, mudslides, and other earth movements
  • Termite infestations
  • Sewer backups
  • Flood damage.

Earthquakes can be covered, however, for those with a tolerance for high price tags and huge deductibles.

Because companies vary in their coverage, Okano advises buyers to shop around. “Homeowners should talk with different agents and ask specific questions about what policies cover.” It’s also a good idea to check with the Washington State Office of the Insurance Commissioner to see if complaints have been filed against an insurance company.

These issues turn on fairly fact-specific, event-specific determinations… One of the best ways to protect yourself is to inventory your household, particularly items that are unique or of particular value.

Paul J. Lawrence

Disputes Over Insurance Claims Arise Despite Liability Coverage Outlines

Although insurance policies outline coverage, disputes still arise when personal property is damaged. For example, although mold is often excluded, there are situations in which it would be covered, depending on what caused it (such as water damage from burst pipes).

“Mold is a complicated issue,” Lawrence explains. “There is some degree of a natural presence of mold [here] because of the climate in the Northwest. Insurance companies typically dispute whether the mere presence of mold is enough to trigger an obligation for remediation or if the degree of mold has to be significantly higher than a natural occurrence.”

Individual reactions play a critical role as well. “Not every person is equally sensitive to mold,” Lawrence says. “In addition, some scientific information suggests that, as you’re exposed to mold, your sensitivity increases over time. Insurance companies have argued that they don’t have to go to extremes to remediate mold problems to accommodate an occupant with extreme sensitivity. I haven’t seen that argument prevail, however. What has generally prevailed is that the insurance companies have an obligation to put the home back into the state it was before the damage so the homeowner can inhabit it without adverse physical reactions.”

What To Do if an Insurance Provider Denies Your Insurance Claim

If an insurance company denies a claim, Lawrence advises homeowners to have an independent investigation, preferably by the type of contractor who repairs the particular type of damage. “These issues turn on fairly fact-specific, event-specific determinations,” says Lawrence.

Companies are required by the state to respond promptly throughout the claims process—but exactly what that means is somewhat vague. “In one situation, a 30-day response time might be adequate,” says Okano. “In another situation, there would be no way the claim could be adjusted in 30 days.”

“One of the best ways to protect yourself,” says Lawrence, “is to inventory your household, particularly items that are unique or of particular value.”

Insurance carriers aren’t obligated to cover personal belongings such as high-end jewelry, art, or unique fixtures unless you’ve listed the items with the company or purchased specific coverage. Lawrence urges homeowners to discuss coverage with their insurance agent and to store receipts and the inventory outside the home.

Okano adds that homeowners should consider raising their amount of coverage if significant home improvements have been made to the

Find an Experienced Insurance Coverage Attorney

It’s best not to wait until the tree falls on your house before finding out whether your insurance company will make noise about paying your claim.

Reach out to an experienced insurance coverage attorney if you fear you’re being taken advantage of by an insurer or have questions about your type of coverage. For more information on this area, see our insurance coverage law overview.

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