Many homeowners assume their insurance policy will step in for any kind of damage, only to discover during a claim that certain costly risks aren’t covered without extra protection. These optional add-ons—often called riders, endorsements, or floaters—tend to fly under the radar, but they can make a significant difference when something unexpected happens.
As severe weather becomes more common and homes continue to age, reviewing these add-ons has never been more important. Flooding now plays a role in the vast majority of U.S. natural disasters, building regulations have grown stricter, and even mild ground movement can cause damage that a basic policy won’t address. With more people keeping high-value items at home or running businesses from their living spaces, an annual policy review is one of the smartest financial steps you can take.
Below are key riders worth exploring and why they may be essential for better protection.
1. Flood Insurance and Water Damage Protection
Most homeowners are surprised to learn that a traditional policy does not cover flooding that comes from outside the home or gradual water damage. If you’re in an area prone to floods, securing a separate flood insurance policy is critical. In higher-risk zones, it may even be mandatory. However, the growing frequency of major flooding means that homeowners far outside these zones should consider additional coverage as well.
Policies from FEMA’s National Flood Insurance Program (NFIP) average around $899 per year and generally cover up to $250,000 for your home’s structure and $100,000 for belongings. Private insurers may offer higher coverage limits or quicker claims processing—helpful in places where rebuilding costs exceed NFIP limits. Since roughly one-third of flood-related claims occur in areas not considered high risk, relying solely on zoning designations can leave homeowners unexpectedly vulnerable.
A water-backup rider adds an extra layer of protection by covering damage from sewer backups, sump-pump failures, or groundwater intrusion. These riders often cost between $50 and $250 annually and typically provide $5,000 to $25,000 in coverage. Because insurers differentiate between flood-related damage and water-backup issues, it’s important to confirm how your policy defines each scenario. Making upgrades like backflow preventers or battery-powered sump pumps may even qualify you for small discounts.
2. Earthquake and Seismic Coverage
Damage from earthquakes is rarely included in a standard homeowners policy. If you’re in a region known for seismic activity, purchasing protection may be required. But even in areas with lower risk, ground shifts or vibrations can still crack foundations, disrupt plumbing, or damage structural components—expenses that can add up quickly. A seismic rider helps fill those gaps.
Many major insurers offer earthquake protection as a standalone policy or endorsement, especially in states such as California, Washington, and Oregon, along with select parts of the Midwest. Deductibles generally fall between 2% and 20% of your home’s insured value. For a home insured at $500,000, this could translate to a deductible of $50,000 to $100,000. Although that may seem steep, repairing major structural damage can cost far more. Many seismic endorsements also include coverage for emergency repairs, debris removal, and temporary safety measures, easing the immediate financial burden after a quake.
3. Building Code and Ordinance Upgrade Protection
If your home ever needs partial or full reconstruction after damage, the repairs must meet current building codes. Even if only a small section of the home is affected, code compliance may require updating larger portions—or even the entire structure. Without additional coverage, those upgrades become your responsibility. A building code or ordinance rider helps bridge the gap.
Building codes change frequently, particularly when it comes to electrical systems, plumbing, insulation, HVAC efficiency, and overall structural standards. These upgrades can increase repair costs by 10% to 20%, and standard policies often don’t account for that. Ordinance or Law riders typically offer 10%, 25%, or even 50% of your dwelling limit to cover these necessary improvements. Even minor damage—such as a contained kitchen fire—can trigger code-required updates throughout the home. It’s helpful to ask whether your current policy includes “increased cost of construction” to ensure you’re properly protected.
4. Scheduled Personal Property for High-Value Belongings
Your homeowners policy likely places restrictive limits on certain valuable items, including jewelry, collectibles, artwork, and electronics. If you own items of significant worth, scheduling them individually is a practical way to secure more robust protection. A scheduled personal property rider lets you insure belongings at their appraised value with broader coverage.
Standard policies often cap reimbursement at levels far below the actual value of many items—for example, $1,500 per jewelry item, a few thousand dollars total for firearms, or $2,500 for silverware. By scheduling items, you typically receive “all-risk” protection, which includes loss, theft, and accidental damage. Costs usually range from $1 to $2 per $100 of insured value, meaning about $200 a year for $10,000 worth of jewelry. Appraisals every few years help keep values accurate, and many policies extend protection worldwide, which is helpful if you travel with your items. Keeping digital records—like photos and receipts—can also speed up the claims process.
5. Home-Based Business Coverage
More people than ever work or run businesses from their homes, but standard policies provide very limited coverage for business equipment and have strict conditions around liability. A home-based business rider can offer better protection for work-related items, inventory, and business activities conducted on your property.
Most homeowners policies include only about $2,500 in coverage for business property inside the home and just $500 for items off-site—far less than the value of a modern home office. A rider can increase this to $10,000–$25,000. For those who meet clients at home, a separate business policy adds liability protection, which is crucial. Many policies updated after 2020 exclude equipment used by remote employees unless it’s specifically added through an endorsement. Depending on your business, you may also need coverage for cyber risks, business interruption, or physical inventory.
Final Thoughts
Riders aren’t just optional extras—they are strategic additions that help safeguard your finances from significant and sometimes unexpected costs. As natural disasters grow more common, building standards evolve, and homeownership needs shift, these endorsements help ensure your coverage aligns with today’s risks. It’s a good idea to review your policy each year, especially after major purchases, renovations, or lifestyle changes. Keeping digital backups of receipts and home inventories can make claims smoother, and bundling insurance policies may offer savings of up to 20%.
If you’d like help reviewing your coverage or determining which riders could benefit your situation, feel free to reach out anytime.
