You might think you have airtight insurance protection against storms, car accidents and other mishaps. But you'd hate to discover hidden cracks in your coverage once it's too late.
Here are five insurance problems you might not be as prepared for as you think — and how to plug the coverage gap.
1. NO FLOOD INSURANCE
Flooding has occurred in every state in the country over the past five years, according to the
Homeowners insurance doesn't cover flooding; you'll need a separate policy. You can find local agents through the National Flood Insurance Program . You can also ask your home insurer for help starting a policy through the federal program, or whether there are companies in your state that offer private flood insurance.
There's a 30-day waiting period before coverage kicks in, so get flood insurance squared away well ahead of coming storms.
2. NO WAY TO PAY OFF A LEASE OR LOAN ON A TOTALED CAR
Gap insurance helps you avoid owing money on a car loan or lease even if your vehicle has been totaled or stolen. Along with comprehensive and collision coverage, gap insurance is a smart addition if you lease or finance a car.
Say you lease a
This is where gap insurance kicks in. It makes up the difference between what your car is worth when it's stolen or totaled and how much you owe on a car loan or lease.
You can buy gap insurance from the car dealership or your lender. Or you can go through your car insurance company — which is typically cheaper unless you want gap coverage for several years.
3. NO PLAN FOR SEWAGE BACKUPS
You may not realize that you're responsible for the sewer line that runs from the main pipeline in the street to your house. Yet standard home insurance typically doesn't cover backups in this part of the line. Enter sewer backup coverage. It pays for cleanup and repairs from spewed sewage in your house.
Sewer backup coverage is relatively affordable —
4. NO INCOME AFTER A DISABILITY
Among 20-year-olds, more than 1 in 4 will suffer a disability before retirement age, according to the
You don't have to rely on your workplace for coverage. Individual disability insurance is available from several insurers, such as
5. NO FINANCIAL SAFETY NET FOR EARTHQUAKES
Most homeowners, even those who live in high-risk areas, go without earthquake insurance. They risk financial ruin if their homes and belongings are destroyed. Only 10 percent of
Standard homeowners insurance won't pay to fix damage caused by earthquakes. Home insurers might offer earthquake coverage as a policy add-on for an extra cost — and in
Californians can shop for a policy through the
This article was provided to The Associated Press by the personal finance website
National Flood Insurance Program: https://www.floodsmart.gov/floodsmart/pages/residential_coverage/rc_overview.jsp