Debunking Homeowners Insurance Myths in Mid-Missouri

Homeowners Insurance: Get the Facts in Mid-Missouri

Homeowners insurance is one of those things you don’t think about until you need it. Unfortunately, by the time you're dealing with a crisis — a tree crashing through the roof, a burst pipe flooding your basement, or worse — it's too late to address any assumptions you had about your policy. There are plenty of myths floating around about homeowners insurance, so let's set the record straight for residents in Mid-Missouri to help you make informed decisions about your home’s protection.

Myth #1: Homeowners Insurance Covers Everything

One of the biggest misconceptions is that homeowners insurance covers every type of damage or disaster. While many policies provide broad protection, they come with exclusions specific to our area. For instance, standard policies typically don’t cover:

• Flood damage. Homeowners in flood-prone areas like those near the Missouri River should purchase a separate flood insurance policy through the National Flood Insurance Program (NFIP) or private insurers.
• Earthquake damage. While not as common, earthquakes can occur in Missouri. Coverage is usually an add-on or separate policy.
• General wear and tear. Insurance is there for sudden and accidental damage, not issues from aging or neglect.
• Sewer backups. Many insurers offer a rider for additional protection, as standard policies generally don’t cover this.

It’s essential to read your policy and know what's covered—and what isn’t—so you’re not caught off guard.

Myth #2: My Home is Insured for Its Market Value

Many assume their insurance should match what their home would sell for on the market. In reality, insurance is based on the cost to rebuild, not the home’s resale value. Market value factors in land and location, while replacement cost focuses on materials and labor to reconstruct the home as it was before the damage. With fluctuating construction costs in Mid-Missouri, reviewing your policy periodically ensures you have enough coverage.

Myth #3: If Someone Gets Hurt on My Property, It’s Always Covered

Liability coverage does protect you if someone gets injured on your property, but there are exceptions. If the injury resulted from negligence—like ignoring a rotting deck railing—you could be responsible for damages beyond your policy limits. Also, if you run a home business and a client is injured, your standard policy may not cover it.

Myth #4: My Policy Covers My Valuables Fully

Most policies have limits for expensive items like jewelry, artwork, and high-end electronics. Your policy might come with caps that are far lower than the actual value of your belongings. To adequately protect high-value items, you can add a scheduled personal property endorsement or rider. This offers broader protection, including coverage for accidental loss or damage that standard policies often exclude. Periodically reviewing your policy, getting appraisals, and keeping an updated inventory is wise.

Myth #5: I Don’t Need Additional Insurance Because I Work from Home

With more people working remotely in Mid-Missouri, it’s a common misconception that standard insurance covers work-related equipment fully. While a standard policy may offer limited coverage for business property, it often has restrictions on the reimbursable value and might not cover employer-owned equipment. Consider these options:

• Home-based business policy. Offers broader protection for business property and liability.
• Business property endorsement. Increases coverage limits for work-related equipment.
• Commercial liability coverage. Protects against lawsuits if someone is injured while visiting for business purposes.

Myth #6: Homeowners Insurance Covers Mold and Termite Damage

Mold and pest damage are usually considered preventable maintenance issues, not sudden damage. Most policies don’t cover them unless mold results from a covered peril, like water damage from a burst pipe. Long-term humidity or unattended leaks typically aren’t covered.

Myth #7: If My Neighbor’s Tree Falls on My House, They Pay for It

This one surprises a lot of people. Generally, your insurance covers damage to your property regardless of where the tree came from. However, if your neighbor was negligent (e.g., knew the tree was dead and did nothing), you might file with their insurance or take legal action.

Myth #8: Filing a Claim Always Leads to Higher Premiums

This isn’t necessarily true. Insurance companies consider many factors when adjusting rates, including your claims history, the type of claim, and your location. A single small claim in Mid-Missouri may not impact your premium much, but frequent claims or high payouts could raise your rates. Weigh the cost of repairs against your deductible before filing.

Final Thoughts

Homeowners insurance is an essential safeguard, but it’s not a one-size-fits-all policy. Understanding what’s covered—and what isn’t—can help you avoid costly surprises. If you’re unsure about your coverage, sit down with your insurance agent to review your policy and ensure you have the right protection in place.

Have questions about homeowners insurance and how it affects your real estate decisions here in Mid-Missouri? Let’s chat.