Homeowners discover coverage gaps at the worst possible time - after disaster strikes and they file a claim. The standard HO-3 policy that most people have includes dozens of exclusions buried in the fine print. Understanding what's not covered is just as important as knowing what is.
Flood damage is the biggest surprise for homeowners. Your standard policy covers water damage from burst pipes or roof leaks, but if water enters your home from the ground up - whether from heavy rain, storm surge, or overflow - it's considered flood damage and isn't covered. Flood insurance is separate and must be purchased through the National Flood Insurance Program or private insurers.
Earthquake damage follows similar logic. Most policies exclude earth movement entirely - earthquakes, sinkholes, landslides. If you live in California or another seismic zone, you need separate earthquake insurance. This coverage is expensive and comes with high deductibles (often 10-20% of dwelling value), but it's the only way to protect against this specific risk.
Mold coverage is extremely limited or excluded entirely on most policies. If mold results from a covered peril like a burst pipe, you might get $5,000-$10,000 in remediation coverage. But if mold develops due to humidity, poor ventilation, or a slow leak you didn't address, you're paying out of pocket. Mold remediation easily costs $10,000-$30,000, making this a significant gap.
Sewer backup is another surprise exclusion. If a municipal sewer line backs up into your home, causing thousands in damage and contamination, standard policies won't cover it. You need to add sewer backup coverage as an endorsement, which typically costs $50-$100 annually for $10,000-$25,000 in protection. Given that one backup can cause $5,000+ in damage, this endorsement is usually worth it.
Your expensive belongings need special attention. Standard policies cap coverage for jewelry, art, collectibles, and electronics at $1,000-$2,500 per category. Have a $5,000 engagement ring or $3,000 laptop? They're only partially covered unless you schedule them individually with an endorsement. Review your policy limits and add riders for high-value items - it's cheap compared to replacing them at your own expense.