Many homeowners believe their insurance policy protects them from every possible scenario, only to discover during a claim that certain risks require added coverage. These optional additions—often called riders, endorsements, or floaters—are crucial for filling gaps that standard policies don’t address. While easy to miss, they can make a major financial difference when unexpected damage occurs.
As severe weather events grow more frequent and homes continue to age, these supplemental protections have become increasingly valuable. Flooding plays a role in most natural disasters in the United States, building codes are continually updated, and even mild seismic activity can lead to costly structural damage. With more people working remotely and keeping high-value items at home, reviewing your policy each year is one of the most effective ways to stay protected.
Below are several important riders worth evaluating and what they can add to your overall coverage.
1. Flood Insurance and Water Damage Coverage
Most homeowners policies exclude flooding that originates outside the home and water damage that isn’t sudden or accidental. If you live in or near a flood-prone region, purchasing a separate flood policy is essential for safeguarding your property. In some zones, flood coverage may even be mandatory. Given the rise in widespread flooding events, many households that were once considered low risk now face meaningful exposure.
Flood insurance through FEMA’s National Flood Insurance Program (NFIP) costs an average of $899 annually, offering up to $250,000 in structural protection and $100,000 in coverage for your belongings. Private flood insurers may provide higher limits and quicker claims processing—an advantage in areas where reconstruction costs exceed NFIP’s maximum payout. It’s important to note that about one-third of flood-related claims occur outside designated high-risk zones, so opting out of coverage can be costlier than expected.
A water-backup rider, typically ranging from $50–$250 per year, provides added protection for damage caused by sewer or sump-pump backups. These riders often include $5,000–$25,000 in coverage. Since insurers differentiate between external flooding (covered under flood policies) and water backup (covered under endorsements), it’s important to verify how your policy defines each type of damage. Installing protective devices like backflow valves or a battery-equipped sump pump may help you qualify for a small discount on your endorsement.
2. Earthquake and Seismic Protection
Damage caused by earthquakes is generally excluded from standard home insurance unless you purchase a dedicated rider or separate policy. If you live in an area known for seismic activity, this coverage may be necessary. However, even in moderate-risk regions, small tremors can affect your home’s foundation, plumbing, or structure—making a seismic endorsement a wise precaution.
Most insurers offer earthquake protection, especially in states like California, Washington, and Oregon, as well as certain parts of the Midwest. Deductibles often fall between 2% and 20% of your home’s insured value. For a property insured for $500,000, that means a deductible of $10,000–$100,000. Although the deductible may seem steep, repairing structural damage can be significantly more expensive. Many policies also include coverage for emergency repairs, temporary protection, and debris removal, helping reduce immediate expenses after a seismic event.
3. Building Code and Ordinance Upgrade Coverage
If your home must be repaired or rebuilt after a covered incident, any updates needed to meet current building codes will also need to be completed. Without the proper endorsement, you would be responsible for paying for those upgrades out of pocket. A building code or ordinance rider helps bridge that financial gap, ensuring your home can be restored to today’s standards without unexpected expenses.
Building codes are frequently updated, especially in areas involving electrical systems, energy efficiency, insulation, and structural safety. These improvements can raise construction costs by 10%–20%, and standard homeowners policies typically do not account for this increase. Ordinance or Law riders generally offer 10%, 25%, or 50% of your dwelling coverage to support code-required improvements. Even a small fire in one room can trigger updates across the entire home, including parts unaffected by the original damage. When reviewing your coverage, ask whether your policy includes “increased cost of construction” protection to ensure you’re covered for these added expenses.
4. Scheduled Personal Property for Valuables
Homeowners policies often impose limits on reimbursement for valuable items such as jewelry, electronics, or collectibles. If you own high-value belongings, a scheduled personal property rider allows you to itemize and insure them at their appraised amounts. This ensures stronger protection than the low sublimits included in most standard policies.
Typical policies cap reimbursement for valuables—often around $1,500 for individual jewelry items or a few thousand dollars for categories like firearms or silverware. Scheduling items provides broader, all-risk protection, covering accidental loss, theft, and damage. Premiums usually run about $1–$2 per $100 of insured value, so covering $10,000 worth of jewelry may cost about $200 per year. Updated appraisals every couple of years help keep valuations accurate, and some policies extend protection worldwide, which is helpful when traveling. Using a digital home inventory system to store receipts and photos can also make filing a claim smoother.
5. Coverage for Home-Based Businesses
If you run a business from home, keep inventory onsite, or use specialized equipment for work, your homeowners policy may not offer adequate protection. A home-based business rider boosts your coverage for work-related property and can help protect you from liability connected to your business activities.
Most standard policies cover only about $2,500 of business property at home and as little as $500 if the equipment is off-site. A rider can raise coverage to $10,000–$25,000, while a standalone business policy provides additional liability protection—especially important if clients visit your home. Many insurers have updated their rules in recent years, excluding remote employees’ work equipment unless they have a dedicated endorsement. For individuals who work as consultants, freelancers, or product sellers, optional add-ons such as business interruption, cyber protection, or inventory coverage may also be beneficial.
Final Thoughts
Insurance riders aren’t just optional add-ons—they’re essential safeguards that protect you from significant, unplanned expenses. As construction costs rise, weather becomes more unpredictable, and lifestyles evolve, these endorsements help ensure your policy keeps up with real-world risks. Reviewing your policy each year, especially after remodeling or major purchases, helps you stay well-protected. Keeping digital records, receipts, and home inventories on hand can speed up the claims process, and bundling policies may reduce your overall premiums.
If you’d like help evaluating your coverage or determining which riders might be right for your situation, feel free to reach out anytime.