Covid-19 And Homeowners Insurance

Consult our guide to managing homeowners insurance during these uncertain times.

The coronavirus pandemic has disrupted many aspects of society, but your home insurance policy will continue to function normally.

Continue reading to learn more about how the homeowners insurance industry is helping consumers allay financial uncertainties during the pandemic. However, many people are currently facing uncertainty with their jobs and finances, as well as ways to save money on your homeowners insurance premiums during this challenging time.

How to handle home insurance during coronavirus — table of contents: 
  1. Will homeowners insurance premiums be affected by the coronavirus pandemic?
  2. Home insurance during COVID-19: FAQs
  3. COVID-19 and home insurance considerations

 


 

Will homeowners insurance premiums be affected by the coronavirus pandemic?

It’s hard to say with any degree of certainty what will happen to homeowners insurance rates. There are many factors to consider. First, people are staying home more often these days, which insurance companies generally regard as good, as it reduces the likelihood of theft. Spending more time at home does come with some additional risks, including an increase in kitchen fires or household accidents.

On the whole, home and auto insurancecompanies are positioned to fulfill fewer claims during quarantine, which could lead to rate reductions. Again, this is speculative, and the state of the economy in the near future will likely play a major role.

 


 

Frequently asked questions — COVID-19 and homeowners insurance

Below, you'll find answers to many of the questions that have arisen for homeowners during the pandemic. As always, if you have additional questions, feel free to submit them here.

 

What if I can’t make my homeowners payment because of coronavirus? 

If you have experienced financial difficulties due to COVID-19, you are not alone. With job losses numbering well into the millions, many Americans are facing much uncertainty about the future. However, state governments and the insurance industry are responding, with many attempting to give relief to those affected.

The National Association of Insurance Commissioners (NAIC) has reported recommendations for states to have a consistent plan of action on how they respond during this crisis. Each state is handling things differently, but most were allowing for leniency in payment deadlines, though it's unclear if they will be extended widely. California, for instance, imposed a 60-day grace period on paying insurance premiums back in the spring, allowing consumers a little breathing room as they navigate this uncertain economic situation. During this time, policies could not be canceled due to non-payment. A number of insurance companies also took measures to provide relief to struggling customers, including Liberty Mutual who extended payment deadlines and waived fees.

However, as the virus continues to spread and cases increase, it's unclear if any further actions will be taken in the summer and fall to provide such relief. 

 

How can I save money on home insurance during coronavirus?

It’s not likely that your homeowners insurance needs will change greatly during this period. However, many are seeking ways to save money due to financial instability. Below are a few suggestions for saving money on homeowners insurance during the coronavirus pandemic.

  • Drop unnecessary coverage: While shelter-in-place orders are in effect, there are some coverage types that may no longer be necessary. For instance, if you rent out a property or part of your home on a home-sharing site such as Airbnb or VRBO, it’s likely that you carried home-share insurance coverage. Dropping this coverage while your rental is unused could be a great way to save some extra money.
  • Speak directly with your insurer: Go over your policy with your insurance agent. Pay close attention to what coverages you have (hint: these can usually be found on your policy’s declaration page). If you find coverage that you don’t currently need, they may be able to help you trim excess coverage to make your policy more affordable. 
  • Ask about available discounts: Most home insurance companies offer a variety of money-saving options for their customers. Adding smart-home features such as wi-fi connected smoke alarms and devices that detect water leaks can lead to discounts with some companies.
  • Add more security: Smart locks, deadbolts and security systems can put your insurance company at ease and even lead to lower rates. 
  • Increase your deductible: The math on this is pretty simple: a higher deductible equals lower insurance premiums. 
  • Shop around: If you are worried about the cost of your coverage, it may be time to look for a new policy. Because every company uses different rating factors, you may be able to find more affordable coverage elsewhere. The Zebra allows you to compare home insurance quotes from a number of top companies to find the best option for your needs. 

 

How are claims and home inspections being handled?

While many aspects of the pandemic might mirror a natural disaster, the implications on the insurance industry are not the same as they would be for a hurricane or earthquake. During such disasters, insurers are inundated with claims, which could slow down the process of receiving a payout. 

While COVID-19 has brought much of society to a halt, property insurance claims are not likely to be affected to the same degree. Most home insurance companies can still respond to claims and help their customers by having a large number of employees working from home. Still, you can certainly expect fewer home visits by most professionals, including claims adjusters, while quarantine measures are in place. Also, if your home is damaged and requires construction work, it could be some time before that work can begin depending on the physical distancing measures taken in your local area. 

Many home insurance policies require a home inspection as a part of the agreement. Similarly to how insurers are handling claims, many will now allow for this to be done with a smartphone. Exterior inspections are still likely to take place in most cases, and normal interior inspections are likely to be scheduled for a date in the future. 

 

Personal liability claims

Your personal liability coverage protects you if you cause injury to another person or damage to their property. With more people at home, it’s very likely that your neighborhood will be much busier with pedestrians than normal. Take precautions to ensure that your property is well maintained and make sure that dogs are kept on leashes, behind a fence or indoors to avoid potential incidents. 

With many schools closed, children may be more common in your neighborhood. Take extra precautions to ensure attractive nuisances such as swimming pools, trampolines, and playground equipment are secure to avoid potential injury. You are responsible for injuries related to these items even if you had no knowledge of the uninvited guests. 

Food and grocery deliveries are also more common these days. If a delivery person slips and falls while on your property, it’s possible that they could file a liability claim against you. Make sure walkways are clear and well lit to help ensure delivery drivers' safety and avoid unwanted claims.

 

Should I consider adding any homeowners insurance coverage during the pandemic?

For the most part, your current insurance plan should be sufficient in most cases. However, working from home and facing shortages of certain household products have thrown many homeowners some curveballs. Have a look at a few endorsements or coverage limit increases that could come in handy during this time.

One of the more unexpected consequences of the COVID-19 outbreak was the rise in sewer backups. With the initial run on toilet tissue and the struggle for many to find it, people resorted to flushing items that had no business being flushed. This shortage has largely been rectified, but adding sewer backup coverage could still be a good idea, as standard home insurance policies don’t usually cover this sort of damage.

Also, as many people have found themselves suddenly working from home, it may be worth considering adding a home business endorsement or — depending on the business type — an altogether separate policy. Adding this coverage can help you in a number of ways, from protecting your technology, clients, or employee records, to covering your business in the event that legal action is taken against your company.

As stated earlier, the likelihood of personal liability claims could increase during this time. It’s always a good idea to have high limits on this coverage, as legal costs can be significant. It’s recommended that your limit be at least $300k, though you should consider an even higher limit if you have significant assets.

 


 

COVID-19 and home insurance: what to consider

Many people are worried about what society may look like on the other side of this pandemic. With uncertainty abounds in the financial sector and staggering job losses, many homeowners are nervous about what additional hardships or costs they might have to endure. If you are having trouble making your payments, speak to a representative from your insurer to see what options are available. Above all, it’s important to make sure that you and your family are adequately protected during these trying times.

 

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Ross Martin LinkedIn

As a licensed insurance agent, Ross is responsible for researching and writing about all matters related to auto and home insurance. He has a background in writing and education, as well as a master's degree from Royal Holloway, University of London. He has been quoted by CNET, iDriveSafely.com, and Kin Insurance.