Common Homeowners Insurance Myths & Misconceptions in NJ

street signs showing myths and factsNo matter the size of your home or how much it cost. It is your world.  Our homes are usually the most valuable things we will ever own, and they are filled will all of our possessions.

Homeowners insurance is absolutely vital to help you protect yourself financially should something happen to your home or possessions.

But as with most subjects today, there are a number of myths and misconceptions around homeowners insurance. You might even believe some of these yourself, but wouldn’t it be terrible to find out you’re wrong when it’s too late?

Home insurance is a waste of time and money

If your house and everything in it were gone tomorrow, could you afford to rebuild it and replace everything inside it?

If you could, then you’d be one of the very lucky few. The fact is, the majority of people couldn’t come anywhere close to replacing what they’d lost.

Homeowners insurance is something that you may never need to call upon, but that doesn’t make it less vital. When you need it, you really need it.

If I make a claim, my premiums will rise

This is not necessarily the case. A one-off claim doesn’t always cause your premiums to rise. Making multiple claims, especially in a short period of time will have an effect on the amount you pay.

If you’re thinking of making a claim on your insurance, try and decide whether it would better to pay for a replacement or repair yourself.

Cheap premiums mean less coverage

While you should never skimp on coverage just to lower your premium, low premiums don’t always equal a bad policy.

Check the fine print on your insurance quotes to see if you’re missing out on any coverage. Also, you might be able to reduce your premiums by installing better door locks of a house alarm.

Your policy covers you for flood damage

This isn’t true. Homes and possessions damaged by floods need to have a separate flood insurance policy in place.

Certain instances of water damage will be covered, but not flood damage.

Medical expenses are covered if you injure yourself at home

As hard as it is to believe, you’re the one person not covered for this. If a visitor injures themselves on your property, then they are covered, but you and your family are not.

Your dwelling coverage is based on your property price

If you had to build your home again from the ground up, how much would it cost?

In some cases, more than the amount you paid for it, in others, less than the sale amount. Base your dwelling coverage on the actual replacement figure.

All valuables items are covered

Though you have a coverage amount to replace the cost of items in your home, most insurance companies have limits on how much they will pay for a single item.

So if you’re hiding away any works of art or expensive jewelry, you will have to declare this. In some instances, the company will insure these items as part of the policy, as long as they have been notified of them and have accurate appraisal figures.

Most likely, you will need an additional policy for these items.

Your home is covered when you’re on vacation

This is more of a tricky one. In general, yes, you are covered for most things that happen to your home while you’re on vacation. There are a few exceptions, however.

If you did not take steps to secure your home or prevent things like water pipes from freezing and bursting due to the cold weather, your insurer can refuse to cover you.

If you are away from home for long periods, some policies require you to have someone come and check on the house periodically. Check your policy to see how frequently your insurer requires this.

You can also read our blog on how to maintain your home while on vacation.

There’s no point in making an inventory list

You might think that it’s pointless to make a list of your possessions for the insurance company. After all, what’s in your house changes all the time.

While it can be a long process, you need a comprehensive inventory list in order to make sure that you’re getting absolutely everything you’re entitled to from your coverage.

You’re covered for the consequences of poor maintenance

Homeowners insurance is designed to protect you if the unexpected happens.

Not looking after your property, to the point where it needs substantial repair, is not covered This includes mold that occurs from lack of proper prevention.

You’ll receive brand new replacements

This one catches many people. In order to replace items new for old, you have to have this specified in your policy.

If they are listed on your policy as their original cash value, then you will only be covered for home much they were worth the time they were damaged/broken.

That means, they could have depreciated in price so much, that you can’t buy anything close to the same model again.

Termite damage is covered

Similar to mold, termites have usually classed as a problem brought on by lack of proper maintenance. Therefore you won’t be covered. When it comes to termites, prevention is really better than a cure.

Have your home inspected often for termites and at the first sign of any issues, get pest control in immediately. It could save you a fortune in costly repair bills.


Hopefully, this article has swept away some of the most common misconceptions about homeowners insurance. These myths get repeated so many times it’s easy to believe them as fact. But your home is too important to leave to chance.

If you have a policy that you suspect might not cover you for all eventualities, then it’s time to review it. You don’t want to find out when it’s too late that you weren’t covered and lose some of your precious belongings, or your home.