Don't Be Surprised if Your Home Insurance Doesn't Cover These Losses

Property owners need homeowners insurance coverage because houses cost a lot of money. For many people, their home is their most valuable asset. Homeowners insurance can also provide coverage for the property inside of a home, which is important since most people keep all their stuff where they live.

A homeowners policy can provide important protection to help property owners avoid emptying their checking account when something goes wrong. But this doesn't mean these insurance policies offer protection for every item or in every situation.

In fact, homeowners should be aware upfront that a few things most likely won't be covered, so they can make other plans to prevent their personal finances from being derailed. Here are some expenses that generally won't be paid for by a home insurer.

1. Flood damage

A typical homeowners insurance policy will not provide coverage for water damage resulting from anything nature-related. While insurers might pay if, say, a refrigerator water line breaks and floods the basement, standard policies won't provide protection from loss if floods happen due to natural causes, such as a hurricane.

Homeowners who live in a flood zone or who fear their house might flood should look into the National Flood Insurance Program run by FEMA. This program can offer affordable coverage that picks up the bulk of expenses for losses if a flood does happen.

Mortgage lenders usually require flood insurance for those who live in flood zones. But even cash buyers don't want to have to pay out of pocket to rebuild if all is destroyed. Buying flood insurance can help ensure that doesn't happen.

2. Mold

Insurers generally exclude any problems in a home caused by negligence or resulting from routine wear and tear. Mold is usually one of those excluded causes of damage. Except in very rare instances, most homeowners insurance companies will simply turn down mold claims and provide no coverage at all to remove the mold or to fix or replace property affected by it.

An insurer might pay if, for example, a fire started and was sprayed with water to put it out, and the water ended up causing mold growth. But in most cases, mold happens when homeowners don't address water-related issues over time. Mold won't be paid for in these situations and property owners will need to pay for remediation and repairs out of pocket.

3. Pest invasions

Bugs and other unwelcome creatures can come into a home and do serious damage. Unfortunately, since the entry of insects, rats, mice, or other small animals is usually seen as preventable, homeowners insurance generally won't cover the damage these nuisance pests cause. This is different from when wildlife, like a bear, causes sudden, unexpected, and unpreventable damage to a home.

It's best to take action swiftly if there's an infestation and call an exterminator right away before a little problem turns into an expensive issue. This is true even though the exterminator has to be paid out of pocket. Pest control and other maintenance is one of the ongoing costs of homeownership.

4. Expensive jewelry

Finally, home insurers don't just limit the specific cause of damage they're willing to cover. They also impose some limits on the property they'll pay for as well.

For example, it's common for insurers to limit coverage to either $1,500 or $2,500 worth of jewelry, depending on the policy. After that limit is met, the insurer will no longer be responsible. Those who need more protection can buy a standalone jewelry policy or, in some cases, can have their insurer add on more coverage of jewelry as a policy rider.

It's important for every property owner to understand the rules and the limits of their coverage. That way, add-on policies like a jewelry rider or standalone flood insurance can be purchased -- and homeowners can save for other problems, like a pest or mold invasion.

Finding out coverage limits before it comes time to potentially make a claim is ideal. Those who know about these exclusions can make sure they put additional coverage in place if they need it.