"Should I Keep Back Up Coverage?"

Written by Tara Neves, The Restoration Doctor Operations Manager

“You can’t schedule emergencies, but you can count on the fact that you will have them.” Financial mentor, Dave Ramsey stated this and I immediately thought about what could happen to my home…that I’m not prepared for. Now, keep in mind, I work in the restoration industry and have a large amount of insurance coverage for my home in case of any emergency which may present itself. However, how about everyone else? How about the people who have not seen three feet of standing water in their basement and no coverage to fall back on?  “But I’ve been paying my insurance every month for the past 30 years, never missed a payment! Why did my agent not sell me this coverage?!” This may be true, but this brings up an unfortunate point; unless you ask for it or are presented it, most people do not think to carry back-up coverage. Completely unintentional, they just simply did not have it presented to them.

What is back-up coverage?

Back-up coverage is a rider that can be added to your insurance policy, among other riders your insurance company may or may not offer. Back-up coverage increments typically range from $5,000 to $50,000 and will help you financially in the event of a back-up in your home.  Now, what is a back-up?  A back up is a discharge of water through your floor drains through storm or sewage routes, or from the event of your sump-pump system malfunctioning or failing. 

How do I make sure I have enough coverage?

First off, you will want to speak with your insurance agent who will communicate what exactly is covered in your back up coverage. Some insurance companies do not cover your belongings; some only cover your appliances, and some cover anything and everything in your basement. The way I have always tried to explain the question of “how much” is simple: mentally add up in your basement what you have between belongings and building materials (finished basement or not), then factor in restoration services. Do you need somebody to come and extract water, remove padding, set equipment to dry your affected areas to standard? It’s hard to estimate what each basement could be. However, the average restoration costs of basement clean ups are $3,000-$5,000. Then add in your contents that are damaged. Then add in re-building your basement. See how fast that money goes?

To summarize; the best thing that you could do for your family and your home is to be prepared. Prepare for any kind of emergency; big or small, and how to function through them. Keeping back-up coverage on your homeowner’s insurance policy is absolutely necessary, and at such a minor yearly cost, it will be greatly worth it in the long run – if say an emergency does arise…because you will be more than prepared!

Disclaimer:  I have no relationships with any insurance companies and this article is solely prepared on a “my opinion only” basis. Ask your insurance agent for recommendations, verification on coverage and your limits.