5 Lesser-Known Perils Covered by Home Insurance

Think you know your homeowners insurance policy? Think again. Most policyholders understand that their policy covers their house and everything inside it. However, few people know that their policy could also cover unusual things like financial fraud and storage unit theft.

Of course, your insurance coverage could be very different from your neighbor’s. So, it’s important not to assume you’ll have equal protection as someone else if something strange happens to your property. You should always consult your policy if you have any questions about what protections it offers. With that being said, here are five lesser-known perils covered by many home insurance policies.

1. Space Debris

You probably know that your insurance policy will cover damages from a fire caused by a faulty electrical wire. But did you know that it likely also covers damage from space debris? So, if a piece of a satellite suddenly tears through your living room ceiling, you shouldn’t have to pay for the damage it causes. Granted, the likelihood of such a happenstance is quite rare. But it’s still nice to know your homeowners insurance policy has got your back.

If your policy doesn’t cover space debris, you might be fine with that. Or perhaps you live in an area where space junk frequently falls out of the sky. If you think your policy is insufficient to cover your risk, it may be time to do some comparison shopping. Ask for a home insurance quote from several different companies and compare them. Go with the policy you think offers the best coverage for a decent price.

2. Drone Accidents and Injuries

Speaking of things falling from the sky, have you noticed how many kids have drones these days? Some of them are barely potty trained, but they’re entrusted with flying objects that can pick up impressive speed. Realistically, some of the riskiest drone operators are adults who get a little too confident while showing off their trick moves.

If your neighbor’s drone catapults through your window during a corkscrew roll gone bad, don’t sweat it. Your homeowners policy should cover the damages. It may also offer protection if your neighbor sees your drone outside their house and decides to sue you for invading their privacy. That said, keep in mind that a homeowners policy only covers noncommercial drones.

3. Pet Bites and Scratches

For many homeowners, pets are beloved members of the family. They provide companionship, security, and loyalty. Unfortunately, no animal’s behavior is always completely predictable. Your normally chill cat might bite the neighbor kid when he pulls on her tail. Or your ever-energetic Fido might scratch up your neighbor’s new car while trying to catch a ball.

Many people are surprised to discover their homeowners policy can offer protection in these types of situations. Keep in mind that most policies only cover damage your pet causes to other people and properties. Therefore, if your dogs knock over your own fence while playing, your policy likely won’t cover that. Additionally, most policies exclude breeds that fall into a high-risk category, including pit bulls, chow chows, and Dobermans.

4. Financial Fraud

Financial fraud is on the rise, with a reported consumer fraud loss of over $10 billion in 2023 alone. Advanced digital tools make it easier to steal other peoples’ money and financial information while remaining undetected. If you experience financial fraud, your homeowners or renters policy may help you recover some of that money. In the case of financial fraud, you don’t have to meet your deductible before your policy kicks in.

Keep in mind that most policies only reimburse up to $500 in fraud losses per incident. Therefore, you’ll still want to work with your bank or other financial institution to recover any losses greater than this. Debit and credit card companies are legally obligated to reimburse fraudulent charges. However, you must contact them within 48 hours of discovering the fraud to be eligible for unauthorized charge reversal or reimbursement. Otherwise, the card issuer only has to return the amount for fraudulent charges greater than $500.

5. Your Belongings Away From Home

If you return to your hotel room while traveling and discover some of your belongings are missing, your homeowners insurance may cover it. Most policies offer personal property protection up to a certain amount. For example, imagine your policy offers 10% coverage for belongings stolen or damaged outside of your home. Therefore, if your belongings are insured for $50,000, you’ll have $5,000 worth of coverage for insured items outside your home.

This type of coverage can apply to belongings you take on vacation or keep in a storage unit. It also typically applies to covered belongings your child takes to a college dorm room. Check your policy carefully to make sure you understand what limitations may apply.

As you can see, homeowners insurance policies often cover unexpected things. Check your policy carefully to see if it covers any of these lesser-known perils. If it doesn’t, it may be worth your time to research more in-depth policies. In addition to checking for unusual protections, make sure your policy also provides adequate coverage for some of the major perils in your area.