An area often overlooked in a homeowners insurance policy is the Other Structures coverage. What does it cover? What is excluded? Is the coverage amount sufficient?
Whether you are renewing your homeowners policy or shopping for a new one – it is important to understand the basics of Other Structures coverage.
What Are “Other Structures”?
“Other Structures” refers to buildings or structures not attached to your home. This could include:
- Detached garages
- Sheds
- Barns
- Fencing
- Driveways
- Carports
- Sidewalks
- Gazebos
- Patios
- Retaining walls
- Greenhouses
- Swimming pools
- Pool houses
- Guest houses
- Piers
Are There Any Exemptions?
It is critical to read your specific policy language, but in general, the Other Structures coverage does not include structures used for business purposes – such as conducting a business or even storing inventory. Other Structures also doesn’t cover renting the structure to someone else, unless used solely as a private garage. Consider these examples:
- A storage shed used to store your home's garden equipment & tools would be covered. However, a storage shed used to store tools from your plumbing business would not be covered under the basic homeowners insurance policy.
- You have a pole building you rent out to a neighboring business and they use it to store their inventory; this would not be a covered exposure under a basic homeowners policy.
- If you are renting your garage to a friend who uses it for a workshop, then it would generally not be covered.
In some cases, you can add specific coverage if you use your structure for business but it varies by company. And depending on the type of structure, there can also be different loss settlement provisions and even different exclusions that can apply.
Coverage Amounts
Most often insurance companies will automatically include Other Structures coverage that is 10% of your dwelling coverage. So if your home is insured for $200,000, your policy may automatically provide $20,000 in Other Structures coverage. This may be sufficient coverage to replace a simple tool or garden shed, but what about an elaborate backyard set-up with gazebo, patio area, and swimming pool or perhaps a barn and fencing? If 10% may not be enough to replace the detached structures on your policy, ask your advisor about additional coverage.
Don’t let Other Structures coverage be just another line item on your homeowners policy. Take time to review the coverage with your insurance advisor and be sure your property is adequately protected.
