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Some homeowner policies cover damage from outages

New Hampshire Union Leader

December 23. 2013 8:18PM

NASHUA — Insurance to help cover costs associated with a power outage is available on many homeowners or renters policies. In fact, some policyholders may have such coverage but aren't aware it exists.

"Most policies call it an expansion endorsement or an enhancement endorsement. It usually comes with a group of add-on coverages," said Beth Needham, operations manager at Eaton and Berube Insurance, with offices in Milford and Nashua.

The options are very different for an individual versus a commercial or business policy.

For the average homeowner, policies are available that provide "enhancements" for food spoilage and hotel expenses, particularly if the residence is considered uninhabitable as a result of a power outage.

"Many times we see a power surge when the power comes back on," said Needham. "That can cause damage that may be covered under a homeowner's policy as well."

Of course, there is an additional premium associated with any additional coverage, and in the case of power outage protection it can range from $30 to $50 a year, up to $150 a year "for the more robust enhancements," according to Needham.

It pays to press your insurance agent on enhancements because that is an area in which many insurance companies compete with each other.

Additional living expense is one area in which there are big differences. Most insurance companies will not deem a home uninhabitable because of a power outage, even one stretching over several days, but the rules vary from company to company.

"Some will provide additional living expenses under more situations than others," Needham said. "This is definitely something consumers should ask about and compare companies on."

For many businesses, utility interruption insurance is essential. Such coverage replaces revenue that is lost due to a power outage that disrupts a business, with exclusions that range from the first 24 to 72 hours of an outage.

"Utility interruption insurance is absolutely something business owners should review with their agent," Needham said. "We always get a lot of interest in that right after something happens, and then the summer months hit and the interest goes away. But it's something we continually try to speak to our business customers about because there are many options."

Obtaining coverage is one thing. Deciding to use it is another."It goes to the theory that you should use your insurance as a protection against catastrophes," Needham said. "Most people don't think, 'I lost power for three days, I'll put in a claim under my homeowner's policy,' and I wouldn't recommend they do. If you put too many claims in, then they cancel you."

For the average power outage, the best insurance policy remains a reliable gas-fired generator.

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