Stay Cool and Covered: The Benefits of Including Home Systems Protection
It’s easy to assume when you first purchased your property insurance policy; you assumed that everything in your home was covered in the event of damage or loss. However, that isn’t the case. Standard policies typically cover damage caused by natural disasters, like wind or fires, smoke, theft, and vandalism. But what about the systems that keep a home running smoothly, like your air conditioners?
Many standard property policies don’t cover these types of systems, like your air conditioner, if they suffer mechanical breakdown leaving you vulnerable to costly repairs or replacement. Ensure you check the exclusion list of your wording booklet to verify, as coverage can vary across insurers.
What is Home Systems Protection?
Home Systems Protection (HSP), also known as Home Equipment Breakdown, is a type of coverage that explicitly protects the systems and appliances in your home. This can include your air conditioning and heating systems, electrical panels, water heaters, and even your home security system. For example, HSP will cover the expenses to repair or replace a furnace breakdown, provided the breakdown was sudden and unforeseeable due to electrical or mechanical malfunction.
These include furnaces, water heaters, air conditioning, kitchen and laundry appliances, home entertainment equipment, radiant floor heating, air and water filtration systems, computers, electronics, and wireless devices, exercise and power equipment, well pumps, sump pumps or pool pumps, and electrical panels.
Benefits of Home Systems Protection
One of Home Systems Protection’s most significant benefits is its financial protection. Without this coverage, you could face thousands of dollars in repair or replacement costs if one of your systems breaks down. Extended warranties often offer inadequate safeguards, leaving you vulnerable to substantial losses for the appliances essential for heating, cooling, hot water, electricity, communication, and backup power.
To mitigate this risk, you may opt for Home Systems Protection, which can be added to your current home insurance policy. Some insurers offer you a discounted rate for the cost of adding this coverage if bundled with Service Line Coverage. Below are some examples of what can go wrong with your home’s systems and equipment and the cost of such losses (price estimates provided by Wawanesa Mutual).
- Regarding your electrical system, it’s crucial to watch for circuit breaker failures that can lead to overloaded and overheated wiring, lighting switches, outlets, and appliances. It is a safety hazard and can result in costly damages. Typical loss: $13,992.
- Additionally, it’s essential to regularly monitor your air conditioning system to prevent it from operating in an overheated condition, which can cause electrical failure. Typical loss: $5,101
- Your furnace is also a critical component; a broken fan/blower can cause damage to other parts. Typical loss: $5,500
- Finally, keeping your built-in stove up-to-date is essential, as out-of-date controls can break down. Typical loss: $3,750
Factors to consider: Home Systems coverage exclusions
While Home Systems Protection is a valuable addition to your property insurance policy, it’s essential to understand that there may be exclusions to coverage. The following are not considered equipment breakdowns:
- Rust, corrosion (including pinhole leaks), erosion, deterioration, or gradual loss of efficiency or functionality of covered home equipment.
- Leakage or seepage at or from any connection, valve, fitting, shaft or seal is also not included.
- Complete or partial interruption of electrical power, fuel or water supply, whether deliberate or accidental.
- Any condition can be corrected by resetting, recalibrating, or performing maintenance.
- Any cosmetic or other damage that does not impair functionality.
As mentioned above, those are only a few of the standard exclusions for this coverage. It’s important to carefully review the coverage inclusions and exclusions before purchasing with your broker for your property insurance, as they can differ between insurers.
The importance of staying cool and covered with Home Systems Protection
By including HSP in your property insurance policy, you can have peace of mind knowing that your most valuable assets are protected. From the air conditioner to the water heater, know that you won’t have to worry about the financial burden of repair or replacement if anything goes wrong. With this coverage, you can stay cool and covered, no matter what life throws your way.
Contact your property insurance broker today to learn more about adding Home Systems Protection to your policy.