Extended Insurance Coverage

Extended coverage is a term used by brokers and insurance companies to denote coverage that goes beyond the limitations of the “basic” policy. All insurance policies have exclusions, or specific losses or reasons for losses that are not covered by the insurance policy, as shown in the pages of documentation you get when you sign up. An Extended coverage (EC) policy can cover these exclusions by adding coverage for the following perils: windstorm, hail, explosion (except of steam boilers), riot, civil commotion, aircraft, vehicles, and smoke. The EC perils are now included in most property policies without the need for a separate endorsement. Although, Extra insurance options can be added to your insurance plan as endorsements. An endorsement is an add-on to your insurance policy that covers a specific item or event.

There are many types of extended coverage as noted on irmi, so this is only a partial list. Your insurance broker can go over the different types in more detail. But, for now, the types of extended coverages you might consider include:

  • Personal Umbrella Liability – You can add between $1 million to $5 million of liability coverage over and above your current policy limits, and with no deductible. While this is a valuable addition to your Home policy, the extended liability coverage also applies to your auto, seasonal, watercraft policies and more
  • Flood Insurance – You may be particularly interested if you live in an area prone to flooding like near the coast because floods caused by hurricanes are usually not covered
  • Hailstorm – Unless hail is explicitly covered by your basic homeowners policy (obviously particularly where hail is commonplace)
  • Earthquake – This is usually only partially covered, or not at all by a conventional policy
  • Extended Title – is an extended coverage because there are many things not covered by basic title insurance policies
  • Medical – Covers illnesses and lengths of stay not covered by the basic medical or health care policy
  • Dental – will help pay for some or partially covered dental surgeries
  • Escape of fuel oil – If you use oil to heat your home, this optional insurance covers you for damages caused by oil leaking from your tank
  • Water – Insures sewer backup and other water damage caused by overflow of outside drains or sewers
  • Scheduled personal articles – Special limits are set on items like jewelery or fine arts. If these items are worth more than the limit specified, you may want to insure them for additional monies

Policies that extend the length of a warranty should be researched before signing up.

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We usually feel, fully covered for potential losses because we carry many types of insurance, but how many times do you read the pages of fine print. A person who lives far from the coast would think that basic insurance that excludes hurricane provisions would be fine, because hurricanes usually strike near the shore. However, they might be surprised to learn that damage from flooding away from the shore due to the rainfall associated with a dissipating hurricane may not be covered.The term “Extended coverage” also can be used to describe coverage amounts (what they’ll pay you for your loss) above and beyond what is already covered. For example, if you live in an area where wildfires are common, you can buy extended coverage insurance that provides more complete restoration of your home and land than your regular homeowners policy would have paid for.Extended coverage can also mean extending the time of a warranty. A plasma TV that has a warranty for a year may have an optional 3 or 4 year warranty extension that is worth looking in to. Car dealers often have these extended coverage policies as well. You should research whether they are worthwhile for the product or service you are buying. For further information the RBC extended coverage section provides a wealth of knowledge on each specific type of coverage.If you think there are areas of risk or potential loss where extended coverage could benefit you or your family, call your insurance broker.