A Policygenius survey reveals widespread misunderstandings about home insurance. (Photo: Shutterstock) Almost 30% of survey respondents thought home insurance costs hundreds, or even thousands, of dollars more than it actually does. (Photo: Shutterstock)

Almost half of the homeowners in the U.S. do not adequately understand how to calculate home insurance coverage. As a result, many may be overpaying for coverage they don’t need or are unknowingly underinsured and leaving their property under-protected in case of a disaster, says a new study from Policygenius.

The “Home Insurance Literacy Survey,” which sampled 2,500 U.S. consumers age 25 and over from June 25 to July 3, 2020, also highlights glaring knowledge gaps in what home insurance does and does not cover. Consider that half of the respondents did not know that a typical homeowners insurance policy does not cover floods, and more than 80% did not know that a standard policy does not cover earthquakes.

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Heather A. Turner

Heather A. Turner is the managing editor of ALM's NU Property & Casualty Group. She can be reached at [email protected].

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