Hazard insurance protects your home in the case of certain events, such as natural disasters, but it is not always included in a regular homeowners insurance policy. While homeowners policies do tend to cover events such as fire or theft, a separate policy may need to be purchased to protect your investment in your home in the event of hazards such as earthquakes, floods, hurricanes and other severe events.

Payment terms and rates will vary depending on the individual company you purchase from, as well as your individual insurance needs.

What Does Hazard Insurance Cover?

It is particularly likely that your regular homeowners policy will not cover events that are common in your area. If the area where you live is known for a high occurrence of earthquakes or hurricanes, for example, that weather event will likely be excluded from your homeowners policy, because of the cost to the insurance company. You will want to be sure to check into hazard insurance to protect you.

Many times, if you have a mortgage on your home, and do live in a high-occurrence area, you will be required to purchase hazard insurance as a condition of your mortgage lender.

Above all, always make sure you know what is covered by your insurance policies. Here are some categories of hazards that will likely necessitate a separate hazard insurance policy:

  • Floods;
  • Fires, especially wildfires;
  • Earthquakes;
  • Storms, such as tornadoes and hurricanes;
  • Landslides and erosion; and/or
  • Sinkholes.

Some hazard insurance policies may cover a mix of different hazard risks, depending on the region. Also, some types of policies only cover very specific types of damage. For instance, flood insurance might have limited coverage for underground structures.

What are Some Legal Disputes that are Common on the Issue of Hazard Insurance?

Any time there is a contract between two parties, it is possible that disputes will arise. Particularly in the case of an insurance contract, disputes can arise when the insured party tries to make a claim, and the insurance company, for whatever reason, disputes the validity of the claim.

Hazard insurance contracts are even more specific, because they are tailored very specifically to the needs of the insured, as opposed to the more standard clauses found in a typical homeowners policy.

The following are bases on which disputes might arise between the insured and the insurer:

  • Discrimination (i.e., denying or withholding coverage based on the applicant’s age, race, sex, or nationality);
  • Attempts to claim incidents outside of normal hazard insurance coverage or attempts to claim damage caused by the homeowner’s own negligence;
  • Fraud or misrepresentation; and/or
  • Breach of an insurance contract term such as defaulting on a monthly payment.

Legal consequences for a violation or dispute generally involve some sort of economic damages award. This will be aimed at compensating the non-violating party for financial losses which were directly caused by the breach.

More severe remedies may include a loss of operating license or a fine if an insurance agent violates industry standards. Suing an insurance company can be a complicated endeavor and may require the assistance of a legal professional.

Should I Hire a Lawyer to Assist Me with a Hazard Insurance Legal Dispute?

In some cases, if you suffer a loss due to a hazardous event, your claim may be straightforward. However, if the issue becomes complicated, or your insurance company denies your claim, then you may wish to consult with an attorney. A local insurance lawyer can help you understand the situation, and can also file a lawsuit on your behalf if it becomes necessary.