Many homeowners believe their insurance policy protects them from every possible risk, but gaps often appear when filing a claim. Some of the most expensive types of damage require additional add-ons, known as home insurance riders, endorsements, or floaters. These optional layers of coverage are frequently overlooked but can prevent major financial loss when the unexpected happens.
As homes age and severe weather events become more common, reviewing your insurance regularly is more important than ever. Flooding now accounts for a large majority of natural disasters in the U.S., building codes grow more complex each year, and even mild ground movement can create structural issues not covered by a standard policy. With high-value belongings, remote work setups, and home-based businesses becoming more common, revisiting your policy annually is a smart financial move.
Here are several insurance riders worth evaluating and the reasons each one matters.
1. Flood Insurance and Water Damage Protection
Most homeowners policies do not pay for flood damage that comes from outside the home or for water issues that aren’t sudden or accidental. If your community is at risk of flooding, a separate flood policy is essential. In fact, if you live in a designated high-risk area, flood coverage may be required. But as flooding becomes more widespread nationwide, this type of protection is now important for many homeowners, even those outside the typical flood zones. A water-backup rider can also protect you from issues like sump-pump failures, sewer backups, or groundwater seepage.
Flood coverage through FEMA’s National Flood Insurance Program (NFIP) averages around $899 each year and can insure up to $250,000 for the building itself and $100,000 for personal belongings. Private insurers may offer higher limits or quicker claims processing — helpful in areas where rebuilding costs exceed federal caps. Since roughly one in three flood claims occur outside high-risk zones, assuming you’re fully safe can leave you financially vulnerable.
Water-backup riders generally cost between $50 and $250 annually, offering $5,000 to $25,000 in coverage. Because insurers treat external flooding and backup-related damage differently, make sure you understand how your policy categorizes each situation. Adding backflow protection or a battery backup for your sump pump may also qualify you for discounts on this endorsement.
2. Earthquake and Seismic Coverage
Damage caused by earthquakes is typically excluded from standard home insurance unless you’ve added specific coverage for it. Homeowners in well-known seismic regions may already be familiar with these requirements, but even those outside high-risk zones can face structural damage from shifting ground or mild tremors. A seismic rider provides valuable extra protection against these risks.
Most major insurers offer earthquake protection either as a standalone policy or as an endorsement. States with high seismic activity — including California, Washington, and Oregon — and parts of the Midwest often see more homeowners purchasing this coverage. Deductibles usually range from 2% to 20% of your home’s insured value. For a home insured at $500,000, that means a deductible between $50,000 and $100,000. Although these deductibles are significant, the cost of repairing a foundation or addressing structural movement can be much higher. Many endorsements also help cover emergency work and debris removal right after an event.
3. Building Code and Ordinance Upgrade Coverage
If your home is damaged and needs repairs, those repairs must meet current building codes. Even minor damage can expose outdated systems that require full upgrades. Without a building code or ordinance rider, these additional costs fall entirely on you. This type of rider helps bridge the gap and ensures required upgrades are covered.
Modern codes change often, especially for electrical systems, plumbing, insulation, heating and cooling efficiency, and structural reinforcement. These updates can add 10% to 20% to the cost of rebuilding, and standard policies rarely include these additional expenses. Ordinance or Law riders generally provide 10%, 25%, or 50% of your dwelling coverage for these improvements. Even a small fire affecting one part of the home can trigger code-required updates for other undamaged areas. Ask your agent whether your policy includes increased cost of construction coverage to avoid unwanted surprises.
4. Scheduled Personal Property for Valuable Items
Homeowners insurance often includes strict limits for high-value belongings such as jewelry, collectibles, or electronics. If you own items worth more than these limits allow, a scheduled personal property rider can ensure each item is properly protected at its appraised value.
Typical policies limit valuables to small sublimits — for example, $1,500 for an individual jewelry item or $2,000 to $5,000 for firearms. Scheduling your items gives you more complete protection that covers theft, accidental loss, and damage. Premiums usually run about $1–$2 per $100 of insured value, meaning $10,000 worth of jewelry might cost around $200 per year to insure. Updated appraisals every few years help keep values accurate, and many policies extend this protection worldwide. Keeping digital records of receipts and photos makes future claims much easier to file.
5. Home-Based Business Coverage
If you run a business out of your home or store work equipment there, your standard policy likely won’t provide enough protection. A business property rider helps cover supplies, tools, and inventory related to your home-based operations.
Most homeowners policies offer only about $2,500 in coverage for business items stored at home, and as little as $500 for items kept off-site — far below what many people now keep in their home offices. A rider can increase these limits to between $10,000 and $25,000, while a separate home business policy can also add liability coverage if clients visit your home. After recent updates to many policies, remote workers often need endorsements to ensure employer-owned equipment is covered. Additional options include business interruption, cyber and data protection, and inventory coverage for entrepreneurs who sell physical products.
Home insurance riders aren’t just optional add-ons — they’re strategic tools that help protect your finances from large, unexpected costs. As building standards, natural disaster risks, and personal lifestyles evolve, endorsements help ensure your coverage remains aligned with real-world needs. Review your policy each year, especially after big purchases, renovations, or life changes. Keeping digital receipts, inventories, and documents can simplify future claims, and bundling policies may offer savings of up to 20%.
If you want help evaluating which riders might fit your situation, feel free to reach out anytime.