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The holiday season is one of the most festive times of year, and people often adorn their homes with decorations both indoors and out. And although decorating for the holidays can be fun, there are risks involved with putting expensive decorations around your property and home.
Homeowners insurance protects your home and personal property, including your holiday decorations, in the event of a covered loss. Homeowners insurance can protect your holiday decorations from anything from a Grinch stealing your outdoor decorations to a light display causing a fire to a blizzard damaging your winter wonderland display. However, just because homeowners insurance covers your decorations from many risks, doesn’t mean it’s necessarily always worth it to file a claim if your decorations are damaged or stolen.
Homeowners insurance covers your holiday decorations if they are stolen, vandalized, or damaged by bad weather
When you file a claim, you have to pay your deductible first. If your deductible is more expensive than your decorations were worth, it may be cheaper to buy new decorations instead of filing a claim
Insurance companies may also raise your rates after filing a claim
Homeowners insurance may also cover you if your decorations cause a fire that damages your home
Homeowners insurance policies cover theft. If your outdoor holiday decorations are stolen, your homeowners insurance can pay to replace them. And if someone breaks into your home and steals your holiday decorations, your homeowners insurance can help pay to replace them along with anything else that was stolen or damaged by the burglary.
When you file a claim for homeowners insurance, you typically have to pay a deductible before your insurer kicks in the rest. For example, if your deductible is set at $500 and your stolen decorations cost $1,500, you’d have to pay your insurer your $500 deductible before they reimburse you for the remaining $1,000.
When you file a personal property claim you're typically paid out the actual cash value of your belongings. Actual cash value refers to the current value of your items, meaning your reimbursement will take into account the age and condition of your decorations when they were stolen. For example, if your inflatable snowman was ten years old, your insurance company would take its age into account and pay you the depreciated value of the snowman. If you want to make sure you get reimbursed as if your personal property was new, you should consider adding replacement cost coverage to your policy.
Homeowners insurance covers vandalism, so if someone decides to spray paint your snowman display or take a hammer to your light installation, you can file a claim with your homeowners insurance company to cover the cost of the damage. As we mentioned earlier, you’d be paid out the actual cash value of your decorations at the time they were vandalized, unless you have replacement coverage, in which case you’d be paid out as if your decorations were new.
A vandalism claim also requires you to pay a deductible before your coverage would kick-in, so if the vandalism damage costs less than your deductible, it may be cheaper to just go out and buy new decorations.
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Whether or not you should file a claim if your holiday decorations are stolen or vandalized depends on how valuable they were and the price of your deductible. If the cost of your deductible exceeds the cost of your damaged or stolen holiday decorations, it’d likely make more sense to buy new decorations instead of filing a claim. For example, if your deductible is $500 and your decorations cost $300, it wouldn’t make sense to file a claim.
You should also take into consideration that many insurers will raise your rates after you file a claim. If you file a claim for your damaged or stolen holiday decorations, you’re risking an increase in your monthly premiums over decorations that you only use once a year. That said, if you had an expensive collection of displays and the loss exceeds your deductible, it may be smart to file a claim so you can make up for the financial loss.
According to a study by the National Fire Protection Association, fires started by holiday decorations resulted in $12 million in direct property damage from 2013 to 2017. A standard homeowners insurance policy covers fire and smoke damage. If your holiday decorations cause a fire that damages the structure of your home, your homeowners insurance dwelling coverage can help pay to repair it. If the fire damages a detached part of your home, like a shed in your yard, the other structures coverage component of your homeowners policy may help pay for those repairs up to your policy’s limit.
To lower your fire risk, don’t decorate any dry trees or shrubbery with lights. It’s also a good idea to switch off your holiday lights and decorations when you go to bed or leave your home. Be sure not to overload any power strips throughout your home either, as that could lead to fires or power surges.
For the most part your holiday decorations are covered by your homeowners insurance, but there are a few instances when they may not be, especially if your insurer identifies negligence as the cause of the damage. Reasons your insurance might not cover your loss include:
You didn’t file a police report after they were stolen or vandalized. Most insurers require a police report for theft and vandalism claims
You were negligent when installing your decorations which resulted in a fire
You used holiday lights that weren’t certified safe by the Underwriters Laboratories
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