Homeowners insurance provides critical protection for your property, personal belongings, and liability. But despite its importance, many homeowners mistakenly assume their policy covers every possible risk. In reality, all homeowners insurance policies include exclusions: specific situations or damages that are not covered.
For residents of Plano, Texas and the greater Collin County area, understanding these exclusions is essential due to the region’s unique weather patterns, growing development, and increasing property values. In this guide, Sterling Insurance Group explains the most common home insurance exclusions, why they matter, and how to ensure your home is properly protected.
What Are Policy Exclusions?
Policy exclusions are conditions or types of damage that your insurance company explicitly does not cover. They exist to prevent insurers from being responsible for high-risk, uninsurable, or preventable losses. While exclusions vary slightly depending on the insurer and policy type, there are some common limitations that homeowners in Texas should be especially mindful of.
Top Home Insurance Exclusions for Plano and Collin County Homeowners
1. Flood Damage
Most standard home insurance policies do not cover damage caused by flooding, including overland water from heavy rains or overflowing creeks. This is a significant concern in Collin County, where flash floods can occur during Texas thunderstorms.
Solution: Consider a separate flood insurance policy, either through the National Flood Insurance Program (NFIP) or Sterling Insurance Group.
2. Earth Movement (Earthquakes, Sinkholes, Landslides)
Damage from earth movement, including earthquakes, sinkholes, and shifting soil, is typically excluded. While earthquakes may seem unlikely in Plano, shifting clay soil and ground subsidence are real risks that can cause foundation damage.
Solution: Add an earthquake endorsement or separate policy if your property is at risk.
3. Wear and Tear or Neglect
Insurance is designed to cover sudden and accidental losses, not gradual deterioration. Damages caused by age, lack of maintenance, mold, rot, or pest infestations are excluded.
Solution: Perform regular maintenance on your roof, plumbing, HVAC, and gutters to prevent long-term damage.
4. Sewer Backup and Sump Pump Overflow
Standard policies generally exclude damage caused by sewer line backups, drain clogs, or sump pump failures.
Solution: Purchase an inexpensive sewer backup endorsement to extend protection.
5. Wind and Hail Deductibles
Wind and hail damage is usually covered in Texas, but it often comes with a separate deductible that’s higher than your standard one—commonly a percentage of your dwelling coverage (e.g., 1-2%).
In Plano and North Texas, hailstorms are common, so this exclusion in practice often means higher out-of-pocket costs during a claim.
Solution: Understand your deductibles and ask about options to reduce them.
6. Ordinance or Law Compliance
If your home is damaged and must be rebuilt to meet new local building codes, the extra costs may not be covered.
Solution: Consider adding ordinance or law coverage, especially if your home is over 20 years old.
7. Business Activities
If you operate a business out of your home—whether it’s a daycare, consulting firm, or online shop, your policy likely excludes coverage for business-related liability or property damage.
Solution: Ask your agent about a home business endorsement or separate commercial insurance.
8. High-Value Personal Property Limits
Jewelry, fine art, firearms, and collectibles may only be covered up to a sub-limit (e.g., $2,500 for jewelry).
Solution: Schedule high-value items separately on your policy to ensure full replacement coverage.
9. Intentional Acts
Any intentional damage or illegal activity by the homeowner or a resident is not covered. This includes arson, theft, or vandalism committed by a member of the household.
10. War and Nuclear Hazards
Extreme events such as war, nuclear incidents, and terrorism are generally excluded across all homeowners insurance policies.
Why These Exclusions Matter in Plano and Collin County
Collin County is one of the fastest-growing areas in Texas. With this growth comes infrastructure challenges, increased strain on sewer systems, and changes to zoning laws. Combine that with extreme Texas weather—hailstorms, heatwaves, and occasional flooding—and you have a recipe for risk.
Local homeowners face increased exposure to:
- Flash floods
- High wind and hail damage
- Foundation issues from shifting soil
- Sewer backups from older infrastructure
- Code updates during home repairs
Failing to address policy exclusions could mean paying thousands out of pocket during a disaster.
How to Close the Coverage Gaps
If your current home policy includes one or more of these exclusions, it doesn’t mean you’re unprotected. Sterling Insurance Group can help you fill the gaps by recommending:
• Flood Insurance
Plano has many low-lying areas prone to flash flooding. Flood insurance is critical—even outside designated flood zones.
• Backup/Sump Pump Endorsements
Essential for homes with basements or older plumbing.
• Earthquake or Foundation Movement Coverage
Optional endorsements are available to cover slab shifts and cracks.
• Scheduled Personal Property Riders
Protect high-value items like wedding rings, artwork, and antiques.
• Ordinance or Law Coverage
Covers the added cost of rebuilding to current codes after a loss.
• Home-Based Business Insurance
Covers business property, liability, and even lost income.
The Sterling Insurance Group Advantage
At Sterling Insurance Group, we help Plano and Collin County residents:
- Understand what their policy does and does not cover
- Customize coverage with endorsements or specialty policies
- Navigate the claims process efficiently
- Perform annual reviews to adjust for life changes and property improvements
We work with top-rated carriers to find you affordable, comprehensive protection tailored to your needs.
Don’t Wait for a Claim to Learn What’s Not Covered
Home insurance exclusions are not just legal fine print—they’re the difference between a covered loss and a financial hardship. By understanding common exclusions and working with a local agency like Sterling Insurance Group, you can ensure your coverage aligns with the real-world risks facing homeowners in Plano and Collin County.
Sterling Insurance Group | (972) 964-4825 | sterlinginsnow.com