Should I File A Holiday Insurance Claim?

Got decorations? If you yard rivals Clark Griswald’s, you’re not alone. Every year, thousands of reveling homeowners put up enough twinkle lights, inflatable Santas and animated reindeer decorations to light up their yard (and a few city blocks, too).

But what happens if those decorations attract the eye of a Grinch who wants to snag your ornaments and take them back to his workshop? Or a Scrooge lacking the spirit of the season wreaks havoc on your lawn vandalizing the lights or the three wise men?

What Your Insurance Covers

Dan Weedin, a Seattle-based insurance and risk management consultant with over 24 years of experience as an underwriter and agent says whether you string up one short strand or thousands of lights, outdoor lawn decorations are covered under your homeowners or renters insurance policy. “They are protected for theft and vandalism just like any other personal property up to the personal property limit listed on your policy,” he says.

But not all homeowners elect to make an insurance claim when Scrooge strikes because of high deductibles or fears the claim might jeopardize rates. So damaged holiday décor – even if you’re a hard core, extreme decorator – might not be worth it.

“You should think twice and carefully gauge the situation before submitting a claim because the financial reimbursement associated with a claim might not be worth the potential hit you could take in premium rates. The opportunity to recover a few hundred dollars could cost you much more than that in the long run,” says Deborah Becker, a State Farm agent in Eau Claire, WI.

If you do opt to file a claim, the process is generally the same as any other property damage or theft claim.

Extreme wear and tear

Ron Moore, senior product development at MetLife Auto & Home, says damage from wear and tear, including normal use rips and tears, breaking decorations as you’re putting them up and similar losses is typically not covered by your homeowners policy.

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“We lost thousands worth of lights and inflatables when mice in our garage chewed through them. And what wasn’t chewed was covered with rodent excrement,” says Diana Turner of Crystal Lake, Illinois.

“If you want additional coverage that extends beyond the typical coverage for weather, theft, fire, etc., you should explore an all risk policy, which provides coverage for all damages unless specifically excluded from the policy,” says Moore.

All-risk coverage costs roughly 10 percent to 25 percent more than standard homeowner’s coverage, says Mark Carrasquillo, a personal insurance agent with E.G. Bowman Co., an insurance agency in New York City. Keep in mind that not all home insurers sell all-risk coverage.

Up in smoke

Weedin says in addition to being the target of theft, vandalism or rodents in need of a place to crash, extreme holiday displays could pose a potential fire hazard, too. “Displays with electrical outlets all over the place do more than jack up your energy bill. If any of the plugs or wires is damaged, frayed, or just bad, a fire to your home and neighbors is a real concern,” explains Weedin. “That also plays into your insurance exposure.”

While that type of claim is generally covered under your homeowner’s policy, Weedin says fire to your home, or your neighbor’s if a blazing inflatable Santa floats next door, could up your premiums if you’ve had a few claims in the past three to five years (depending on the insurance company).

Weedin says you can sidestep a potential rate hike by decorating with care and following all manufacturers’ safety guidelines to reduce your chances of a tragedy. And if you’re not sure how many strands to plug into one extension cord or outlet, consult an electrician.

And in the event you do need to file an insurance claim, hang on to receipts for holiday decorations and take photos of them, says Moore. “This information should be kept safe with a larger personal property inventory to help streamline the claims process in the case of a loss because an inventory can make the claim process go much smoother and faster,” says Moore.

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Gina Roberts-Grey is a staff writer for SuperMoney. Her mission is to help fight your evil debt blob and get your personal finances in tip top shape.
Photo: Crazy Frankenstein