An insurance endorsement, sometimes called a rider, is simply an amendment to your homeowners insurance policy. An endorsement can add, remove, exclude, or limit your coverage. Most folks add endorsements to homeowners insurance to increase coverage or limits for their dwelling, belongings, and personal liability.
An endorsement can be a physical form that gets attached to your policy, but that’s not always the case. If you want to change your billing address, that action is called an endorsement, but there’s no form associated with it.
Whether your insurer uses the term endorsements or riders, the changes they make can usually be added at just about any time during the life of your policy. The key is they must be added to an existing policy; endorsements can’t be purchased as standalone insurance products.
How does an insurance endorsement work?
When an insurance endorsement is added to your policy as a form, it legally modifies a specific coverage. An endorsement not only makes note of the specific alterations in coverage, it actually becomes a part of your insurance policy. Typically, this requires additional premiums.
Endorsements that don’t affect coverage, like an endorsement for a name or mailing address change, don’t impact your premium.
Why you might need an insurance endorsement
There are at least three situations where you may need an endorsement for your insurance policy.
Address or name change
If you legally change your name or need your bill sent to a new address, you need that reflected in your home insurance. This can be done through a simple policy change endorsement.
New personal property
Additional personal property, particularly valuable items like high-end jewelry or collectibles, may require a change to your personal property coverage.
Coverage change
Modifying coverage is probably the situation that people usually think of when they’re talking about insurance endorsements. You can use endorsements to:
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Add coverage for perils that are excluded from your homeowners policy.
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Extend coverage to another person or location.
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Increase or decrease the scope of your coverage.
Types of homeowners insurance endorsements
We’ve categorized coverage endorsements into three broad types: mandatory, conditionally mandatory, and optional.
Mandatory endorsements
Some insurance are mandatory, as in they’re always included, every time.These are often dictated by state law.
For example, some states require insurers to cover mold and fungus. A standard policy doesn’t cover that, so your insurer needs to add an endorsement to include it. Other mandatory endorsements may come from your insurer. This is often the result of the insurer adjusting a standard form to fit its risk profile or adapting a countrywide form to comply with state-specific regulations.
When an endorsement is mandatory, the insured has to accept it. If they don’t, the insurer won’t issue a policy.
Conditionally mandatory
A conditionally mandatory endorsement is one that may be required under certain circumstances. A good example is a roof surfacing payment schedule endorsement (RSPS). In certain states, homes with roofs that are 10-years old have to get an RSPS to get coverage.
Another example is when you rent out your home. You may be required to add an endorsement specific to the needs of a rental property.
Optional
All the other endorsements are optional, meaning the insured can elect to add them if they want the additional coverage. We’ve provided several examples of optional endorsements below.
Examples of endorsements
Endorsements can help you better customize your home insurance based on your needs and budget. This list presents just a few of the options that may be available to you.
Flood coverage
Many homeowners get flood insurance as a standalone policy from the National Flood Insurance Program. However, some private insurers offer flood coverage as an endorsement to your home insurance.
Animal liability coverage
If your pet damages the property of others or causes an injury, you can be held liable for the cost. An animal liability endorsement can help you pay such a claim.
Hurricane screen enclosure
Screen enclosures are an investment that are often excluded from homeowners insurance, so it makes sense to add coverage that protects them. A hurricane screen enclosure endorsement can help pay for hurricane damage to screened enclosures, aluminum-framed carports, and awnings.
Personal property replacement cost coverage
Home insurance companies typically cover your personal for its actual cash value. Adding a replacement cost endorsement changes the coverage so you can replace damaged personal property with similar items at today’s prices. This increases the ultimate settlement you receive in a covered loss.
Scheduled personal property
The scheduled personal property endorsement might catch your eye if you have jewelry, antiques, fine art, or a coin collection. Most homeowners policies limit the coverage amount for these and other valuable items, but scheduling lets you insure them for up to the appraised price.
Increased Coverage A
This endorsement allows you to increase your dwelling coverage, also called Coverage A, without increasing other limits. It’s an excellent way to ensure your house has sufficient coverage while minimizing the impact on your premiums.
Ordinance or law coverage
If you have to rebuild your home after a covered event and are required by law to meet new building codes, an ordinance or law endorsement can help cover the extra expense.
Water backup and sump overflow coverage
Water backup and sump overflow endorsements can cover damages caused by water entering your home through public utilities and septic systems. This is protection not provided under a standard home insurance policy.
Sinkhole coverage
You can add sinkhole coverage to a standard home insurance policy to address damage caused by sinkholes. This is different from the catastrophic ground cover collapse coverage required in Florida policies.
Limited fungi, mold, wet or dry rot, or bacteria coverage
If you want extra protection for mold damage, this endorsement can help. It is particularly helpful for those who live in warm and humid climates.
Identity fraud coverage
Stolen identities are expensive to recover, but an identity fraud insurance endorsement can offset some of the costs associated with getting your life back on track. It can cover expenses like attorney and tax advisor fees, credit report fees, loan re-application fees, and more.
Personal injury
This endorsement offers coverage if you’re sued for libel, slander, invasion of privacy, or other personal injuries. These claims can be significant, and this endorsement helps with your legal defense.
Golf cart physical damage coverage
Homeowners in retirement and resort communities and even some who just have lots of acreage often use golf carts to get around. Unfortunately, standard home insurance policies exclude coverage for golf carts, so getting a golf cart endorsement can make good sense for them.
Do endorsements have deductibles?
Home insurance endorsements typically don’t have separate deductibles, even when they provide additional coverage. That said, your policy likely does have at least one deductible that applies to losses. You may want to factor that into the equation when you’re deciding whether or not you want to add coverage to your policy.
How long is an endorsement valid?
Typically, an endorsement is in force for the duration of your policy term and can be renewed along with your policy.
However, there are limited-term endorsements available for temporary situations, like when your home is vacant during renovations. In this case, you could get a vacancy permit endorsement, that’s only in effect while your house is being remodeled.
How do you request an insurance endorsement?
Requesting a specific endorsement for your homeowners insurance policy begins with contacting your insurance agent. Your agent will then review your existing coverage and discuss what’s changed in order to determine if your insurer has an endorsement that correctly covers your situation. Your agent should also discuss the difference in cost if you’re modifying your coverage.
