How to Read an Insurance Policy

How to Read an Insurance Policy

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Whether you just bought a new insurance policy or you are still faithful to your old one, understanding everything on your policy can be very tricky. If you know what you are signing up for, you might be able to negotiate more with your insurance company when you file a claim. After all, your policy can be read much easier if you break it down, which is what we are going to be doing in this blog. Here is everything you need to know about how to read an insurance policy. 

What’s In The Insurance Declaration Page

This is the first page that will most likely appear on your insurance policy. Think of it as the overview of your policy. It identifies who is insured, your policy limits, what property is covered, and most notable of all, the policy period. If you need to know any of the basic information as to how much you are covered for, this is the page to look for it. Like we are going to say a lot throughout this blog, pay careful attention to the wording and language your policy uses. Specifically pay attention to the wording under the coverages and limits section, as you will also find your limits and deductibles. These sections can be very confusing if you just glance at them and don’t understand the limits of your insurance policy.

Reading The Insuring Agreement

The insuring agreement, while similar to the insurance declaration page, is all about what your insurance company is promising to insure for you. This page will go over what is known as covered-perils, or what the insurance company will cover for you in the case of a disaster. Most homeowner insurance policies tend to cover for similar types of damages such as waterfiremold, etc. The insurance company may state here what is technically defined as covered peril. If you do not see a specific type of peril listed, the insurance company does not cover it for you. Something also important to take notice of; most insurance companies will not cover damages due to poor upkeep of the home. Sometimes this can be tricky to determine, but most of the time it is easy to tell what is damage from a disaster vs. poor maintenance.

covered peril in your insurance policy. How to read an insurance policy.
When reading over your insuring agreement, be sure to look at the covered peril section to know what will be covered in the event of an disaster.

The Exclusions Section

This is perhaps the most important part of your insurance policy. As here you will get to figure out what types of coverage are taken away by the insuring agreement. Most of the time, there are only a few types of exclusions, as they can range from excluded perils or causes of loss. Most of the time there is a reason for why these types of exclusions are there, as they are very expensive to cover completely. For example, in the case of a flood or earthquake, the damage to repair your items exceeds the cost of replacement. Therefore, your insurance company strictly states these exclusions on your policy, so you know ahead of time what cannot be covered.

The Conditions Page

This page is where you will find all the information that is required of you when filing for an insurance claim. If the conditions are not met, your insurance company can and will easily deny you of any claims filed. Make sure you read all the conditions they list, that way you know exactly what you need to do, in order to stay on the good side with your insurance company. At the end of the day, think of it this way, establishing a healthy relationship with your insurance company will go a long way for you when you need them most. If you follow their conditions, they will comply.

how to read an insurance policy - an important step is to look at the conditions page
Establishing a healthy relationship with your insurance company is super important when it comes to filing an insurance claim. Ask them questions, they will be happy to answer any you may have.

A Smaller But Still Important Section, The Definitions

We think it’s very important to go over this section of your insurance policy. If we included every definition of every single word that you may find on your insurance policy, this blog would be very lengthy. Your insurance company will put on your policy, every definition included in it and more. If there is something you do not understand such as a certain phrase or word, the definitions page is where you should go!

Still Having Trouble Reading Your Insurance Policy?

Don’t worry! It’s a lot of information all at once - we totally understand! Hopefully though, we were able to answer any of the questions you may have about your insurance policy. For more information on your insurance policy the best place to ask your questions would be your insurance company. If that doesn’t work, try calling us! At Performance Adjusting we have been helping our clients for over 18+ years with insurance claims and answering any questions you may have about your current policy. We offer free consultations, for any question you need answers to. If you do have an insurance claim and you are not getting the money you deserve, it's time to call a public adjuster! They work for you and make sure you receive the best possible settlement, unlike the insurance adjuster who works for the insurance company. 


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We handle your property damage insurance claim so that you don’t have to. Since 2005, we’ve been getting homeowners and business owners the most money for their property damage all while they sit back and relax. The best part of it all? There are no upfront costs or hidden fees, we only get paid when you get paid.

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