There are many potential gaps that could exist within an individual’s insurance policies. Below are a few common gaps that can create a large financial loss for an insured if they discover that they do not have proper coverage.
First, valuable articles such as jewelry, typically have a limitation of coverage. Most policyholders do not realize if a piece of jewelry is lost or stolen the policy has specific limits which may not be adequate to replace the item. The solution is to schedule each item individually on the policy. Generally, the carrier will charge a premium to schedule but the valuable item will have adequate coverage at the time of a loss.
Another misconception is coverage for property used primarily for business purposes. Most individuals assume a Homeowners policy will cover all belongings including items used for a business, such as Tools, computers, or equipment. The homeowner’s policy also has specific limits for Business property which is generally not enough coverage. The solution is to get a Commercial Inland Marine policy covering such items used for your business so in the event of a loss you are insured properly.
In regards to auto insurance, if you are involved in an accident and your vehicle is in the shop, a basic policy will not cover the cost of a rental car. The good news is that rental car reimbursement coverage can be added to the policy to cover that cost. Carriers will provide coverage from $30 per day up to $100 per day toward the cost of a vehicle, depending on the carrier. The rental car reimbursement coverage only applies when there is a covered accident. If your vehicle is in the shop for maintenance, then this coverage would not apply.
Another automobile insurance confusion is related to the replacement parts of your car. If you are involved in an accident, the damaged parts of the vehicle may be repaired using parts that are not manufactured by the original manufacture, or aftermarket parts. Unless you add on the endorsement to cover OEM parts, the carriers typically do not pay for original manufacture parts (OEM).
Please contact us if you have any questions regarding coverages on your policy