Is My Home Insurance Enough? How to Avoid the Most Costly Coverage Mistakes

by | Nov 18, 2025 | Blog, Flood Insurance, Homeowners Insurance, Insurance, Insurance Claims, Insurance Endorsements

Michigan homeowner reviewing home insurance coverage to check for gaps.

Is My Home Insurance Enough? How to Avoid the Most Costly Coverage Mistakes

Many homeowners ask the same important question: “Is my home insurance enough?” It’s a smart thing to think about. Most people assume their policy protects them from almost anything, only to find out the hard way that certain losses aren’t covered. Understanding what your policy includes — and what it leaves out — is the key to avoiding expensive surprises.

This guide breaks down the most commonly misunderstood coverage areas so you can confidently answer whether your home insurance is enough for your family.

Is My Home Insurance Enough? Common Coverage Gaps

There’s a major misconception among homeowners that their policy covers everything except floods. Unfortunately, that’s not how home insurance works. Your policy protects you from sudden and accidental losses — not wear-and-tear, maintenance issues, or every type of water damage.

Here’s where most people discover gaps.

1. Water Damage (The Most Misunderstood Area)

Water coverage varies drastically, and it’s one of the biggest indicators of whether your home insurance is enough. According to the Insurance Information Institute, water damage is one of the most frequent causes of home insurance claims.

✔️ Typically Covered

  • Burst pipes

  • Sudden plumbing failures

  • Appliance malfunctions (water heater, dishwasher, etc.)

❌ Not Covered Without Endorsements

  • Water seeping through foundation

  • Sump pump failure

  • Sewer or drain backup

  • Long-term or hidden leaks

  • Flooding from outside water sources

Michigan Tip:
If you have a basement — finished or unfinished — you need Sewer/Sump Backup coverage. Without it, a $10,000–$40,000 loss can come out of your pocket.

2. Electrical Surges & Power Issues

Strong storms and utility fluctuations make this a big deal in Michigan.

✔️ Often Covered

  • Surges caused by lightning strikes

❌ Not Covered Without Equipment Breakdown Coverage

  • Brownouts

  • Utility-created surges

  • Whole-home electronics damage

If you have newer appliances or smart home tech, Equipment Breakdown is one of the best low-cost add-ons to ensure your home insurance is enough.

3. Detached Structures

Your policy includes coverage for:

  • Sheds

  • Fences

  • Detached garages

  • Pools

  • Decks

  • Driveways

But the limit is usually 10% of your dwelling amount, which may not be enough if you’ve added a large garage, pole barn, or upgraded outdoor structures.

4. Liability Coverage & Dog Bites

Liability is often the most important part of determining whether your home insurance is enough, especially if you have kids, pets, or frequent visitors.

Common Liability Questions

  • Does it cover dog bites? (Depends on carrier and breed restrictions)

  • What if someone gets hurt on my property?

  • What happens if I get sued?

With lawsuit settlements rising nationwide, $500,000 liability + a $1M umbrella is the new minimum standard for most families.

5. Mold, Rot & Long-Term Damage

Home insurance is not a maintenance plan, and this is where many claims get denied.

❌ Not Covered

If the issue didn’t happen suddenly and accidentally, it’s usually excluded.

6. Roof Coverage & Depreciation

Many homeowners don’t realize that their roof may be covered on:

  • ACV (Actual Cash Value) instead of replacement cost

  • Age-based coverage restrictions

  • Higher wind/hail deductibles

This can significantly reduce payouts and determine whether your home insurance is enough in a storm-heavy area like Michigan.

7. Tree Damage

This one surprises people.

✔️ Covered

  • A tree falls on your home, garage, fence, or deck

  • Limited removal of the tree portion that caused damage

❌ Not Covered

  • Tree falls in your yard but causes no damage

  • Preventative removal of hazardous trees

8. Service Line Coverage

Most people don’t know they are responsible for buried lines that run from the street to their home, including:

  • Water lines

  • Sewer lines

  • Cable/internet lines

  • Electrical lines

A break can cost $3,000–$12,000, and without the Service Line endorsement, it’s not covered.

Michigan-Specific Risks to Consider

Michigan homes face unique hazards like freeze risks, clay soil shifting, lake-effect storms, and aging infrastructure. To know whether your home insurance is enough, consider adding:

  • Sewer/Sump Backup

  • Service Line Coverage

  • Equipment Breakdown

  • Extended Replacement Cost

  • Matching Siding/Roof Coverage

  • Watercraft liability for lake homes

These small additions handle the most common Michigan claim scenarios.

How to Know If Your Home Insurance Is Enough

Use this quick checklist:

Your home insurance may NOT be enough if:

  • You haven’t reviewed your policy in 2+ years

  • You recently remodeled or finished a basement

  • You added a pool, deck, pole barn, or outdoor structures

  • You’re missing common endorsements

  • Your liability limit is below $500,000

  • Your roof is older and covered on ACV

A short review can prevent thousands in uncovered losses.

Get a Free 15-Minute Home Insurance Review

If you’re still wondering, “Is my home insurance enough?”, I can walk you through a quick coverage review to identify any gaps and improve your protection.
No pressure — just clarity and confidence.

Call Customers First Insurance Group: 586-221-6870
Request a quote: https://customersfirstig.com/insurance-quote