Summary: Many new homeowners in Minnesota and Wisconsin are unaware of important insurance coverages that standard homeowners policies may not include, such as flood insurance, sewer backup coverage, and personal property special coverage. Working with Stein Insurance helps homebuyers identify coverage gaps and customize policies that fully protect their investment.
Understanding your insurance coverage is crucial for protecting your investment.
Researching your insurance coverage options can save you money in the long run.
Many new homeowners need to evaluate their insurance coverage more closely.
The spring buying season is nearly upon us in Wisconsin and Minnesota. Buying a home is one of the most exciting milestones someone can achieve in their life. Between inspections, financing, and closing paperwork, homeowners insurance is often just another box to check.
Your insurance coverage is a vital part of your home buying process.
Flood insurance is an essential piece of your insurance coverage strategy.
Having adequate insurance coverage can save you from financial ruin.
However, many new homeowners unknowingly leave gaps in their insurance coverage that can cost them in the event of a claim. At Stein Insurance, we regularly help new homeowners understand the coverages they didn’t realized they needed. Let’s take a look at the most commonly overlooked protections and why they matter, especially in the Upper Midwest.
Assess your insurance coverage options thoroughly before making a decision.
Homeowners should always review their insurance coverage for better protection.
Flood Insurance
Replacement cost insurance coverage is often more beneficial than market value.
Understanding your insurance coverage can help avoid potential pitfalls.
We’re starting out with a big one. Many new homeowners assume flood damage is covered in a standard homeowners insurance policy. Unfortunately, that is rarely the case.
Ensure that your personal items are secured under the right insurance coverage.
Spring snowmelt, heavy rainfall, ice melt, and overflowing lakes and rivers can all cause flooding, even in areas that are outside the federal flood maps. Even if you only experience a flooding event once, it can cause major damage that can take you years to recover from financially.
This is why we often recommend new homeowners consider a separate flood insurance policy. A flood policy ensures your home is protected if water enters your home. Mortgage lenders often require flood insurance for properties in designated flood zones. However, a flood policy can be beneficial even for homes outside these high-risk zones.
Sewer and Drain Backup Coverage
Flooding isn’t the only way your home can experience water damage. Water can also back up through sewers or drains and cause serious property damage. Many standard policies provide limited or no coverage for this type of loss.
In the Upper Midwest, rapid snowmelt, frozen ground, and heavy seasonal rains can overwhelm sewer infrastructure and cause sewage to back up into your home. Fortunately, sewer and drain coverage is an affordable endorsement on your homeowners policy. It covers the cost of cleanup, repairs, and damage to personal property in the event of a sewer or drain backup.
Replacement Cost v. Market Value Coverage
Always consider your ordinance and law insurance coverage when assessing risks.
Upgrading your insurance coverage can prevent unforeseen expenses.
New homeowners are often tempted to insure their home based on purchase price or market value. However, these values rarely match the actual cost to rebuild a home.
Construction costs, labor shortages, and material prices can make rebuilding far more expensive than expected. If your coverage is too low, you may have to pay substantial out-of-pocket costs in the event of a total loss.
At Stein, we highly recommend our customers insure for the full replacement cost of their home. During our annual reviews, we update the coverage amount as construction costs change.
Comprehensive insurance coverage is critical for protecting your new home.
Personal Property Special Coverage
Standard homeowners policies include some personal property coverage, but this coverage is often limited for high-value items.
Items that we see most often underinsured include jewelry and watches, firearms, collectibles, antiques, musical instruments, and electronics and other specialized equipment.
There are a few solutions to insuring your high-value personal property. We can schedule valuable items individually in your homeowners policy to provide broader coverage and fewer claim limitations. In some circumstances, we may recommend a separate policy for your items, such as a jewelry insurance policy.
Umbrella Liability Coverage
Many new homeowners underestimate their liability exposure now that they are property owners. Accidents involving guests, pets, or hazards on your property can lead to costly lawsuits that exceed the limits of a standard homeowners policy.
An umbrella liability policy is an affordable way to make sure you’re properly covered in the event of injury or other event on your property. Your Stein Insurance agent will work with you to determine which level of coverage is appropriate for you.
Ordinance and Law Coverage for Wisconsin Homes
Your homeowners policy provides vital financial support in the event of a loss that damages your home. However, you may be surprised to learn standard policies may not fully cover the additional cost of bringing rebuilt areas of your home up to today’s building codes.
Older home are common in Wisconsin. If damage occurs, rebuilding to your city’s current electrical, plumbing, or structural code standards can add significant expense.
Ordinance or law coverage helps pay for these code-related upgrades. Add it to your homeowners policy to ensure all of the costs of rebuilding are covered in the event of a loss.
Why not Minnesota? In the Land of 10,000 Lakes, insurers must cover the costs to bring a damaged property into compliance with current building codes. In other words, this coverage is already baked into your homeowners policy.
Protect Your New Home with Confidence
Your new home is likely your most valuable asset. Make sure you have it adequately protected so an unexpected event doesn’t turn into a major financial setback.
Working with your independent agent at Stein Insurance ensures your insurance coverage is designed specifically for your home, your risks, and your future.
Does a standard homeowners insurance coverage policy cover flooding?
No. Most homeowners policies exclude flood damage, which typically requires purchasing a separate flood insurance coverage policy.
Does a standard homeowners insurance policy cover flooding?
No. Most homeowners policies exclude flood damage, which typically requires purchasing a separate flood insurance policy.
Why is sewer and drain backup coverage important in Minnesota and Wisconsin?
Seasonal snowmelt, heavy rainfall, and frozen ground can increase the risk of sewer backups, which can cause expensive property damage and cleanup costs.
What is ordinance or law coverage, and why do Wisconsin homeowners need it?
Ordinance or law coverage helps pay for the extra cost of rebuilding or repairing your home to meet updated building codes, which is especially important for older homes in Wisconsin.
How can an independent insurance agency help new homebuyers?
Independent agents compare multiple carriers, explain coverage options clearly, and customize policies to match your home, location, and financial goals.
