How would you proceed if this were to happen to your home? Most people are not sure how to move forward with an insurance claim in such a case. Does the driver’s auto insurance company pay for damage? Does your homeowner’s policy apply? There might be plenty of insurance to go around, but who pays for what?
The Driver’s Vehicle Policy
Let’s start with the number-one rule for vehicle accidents: The party at fault for an accident is liable for any damage caused by that accident. They are on the hook for the damage caused to your home, or any other property for that matter, if an auto crashes into it, and the crash was the driver’s fault. The property damage clause of an auto policy comes into play here, up to the limit set in the policy. Suppose that an auto crashes into your home. It causes $20,000 in damage. The at-fault driver’s auto policy has a property damage coverage limit of $25,000. Your damage should be paid for in full through the driver’s policy in that case. But what happens if the driver’s coverage limit is $25,000, and your home suffers $50,000 in damage?
Your Homeowner’s Policy
Your homeowner’s insurance should pay for any damage to your home above and beyond the at-fault driver’s auto policy limits. Most standard homeowner’s policies protect the owners for damage to their dwelling and connected structures, such as a garage, that is caused by hazards such as fire, smoke, theft, vandalism, windstorm, and other things—like autos. Most standard homeowner’s policies cite “vehicles” among the hazards covered that might cause damage. Your homeowner’s policy should also cover you if your house is damaged by a driver who doesn’t have any insurance coverage.
What if You Damage Your Home?
Maybe you backed out of your garage with the door closed, or you gunned it too close to an outside wall. You might be surprised to learn that the same rules often apply either way, whether you caused the damage or someone else crashed into your home. You would have to make a claim on your auto policy for any damage to your vehicle, but you would make a claim on your homeowner’s policy for the damage to your dwelling in most cases. Again, it’s key to read your policy with care so you can be sure you are covered in such a case.
The Matter of Deductibles
Most homeowner’s policies come with high deductibles, so making a claim can cost you a fair bit of money out of pocket. It may not be worthwhile to make a claim if the damage to your home is not severe and won’t cost too much to repair. You will have to make claims on both your auto and homeowner’s policies if your vehicle caused the damage to your home. That can mean paying two deductibles. Making insurance claims might increase your premium at renewal time as well.
