Holiday disasters: What does home insurance cover?

The holiday season is one of joy and cheer, but it can come with increased risks. Holiday disasters like house fires, vandalized decorations, and home burglaries often spike come November and December. Fortunately, a homeowners insurance policy can help out if the holiday season takes a turn for the worse, Policygenius explains. 

Key takeaways:

• Homeowners insurance covers many common types of holiday disasters—including kitchen or Christmas tree fires, vandalized decorations, and burglaries.
• If a guest gets injured in your home—like if they slip on a patch of ice on your driveway—your liability coverage can help pay for their medical expenses and your legal bills.
• Homeowners insurance doesn't cover maintenance issues, so if you pour turkey fat down your drain and it clogs your pipes, you'll have to pay for repairs out of your own pocket.

5 Holiday Disasters That Are Covered by Homeowners Insurance

Homeowners insurance includes coverage for your home and personal property if they're damaged by a covered event—like if your cinnamon-scented candle causes a house fire. If the fire leads to your home needing major repairs, the loss-of-use coverage part of your policy can pay for additional living expenses, like a hotel stay, while your home is being rebuilt.  

Homeowners policies also include liability coverage. This covers you if you're responsible for someone else's injury, like if a guest falls down the stairs at your New Year's party and you're required to pay for their hospital stay. 

Below are some common holiday disasters that are covered by home insurance. 

1. Fire Damage

Thanksgiving is the leading day for kitchen fires nationwide, followed by Christmas Day, the day before Thanksgiving, and Christmas Eve, according to the National Fire Protection Association.  There's also an estimated 160 Christmas tree fires a year, and incidents of candle fires surge in December. 

Homeowners insurance covers fire damage, so if your house burns down or your personal property is damaged by a fire during the holidays, your homeowners policy can help pay for repairs. 

Here are some holiday fire scenarios covered by homeowners insurance: 

• Kitchen fires
• Christmas tree fires
• Fire damage caused by holiday decorations and lights 
• Fire damage caused by candles

2. Stolen Gifts, Packages, and Decorations

Homeowners insurance policies cover theft, so if someone breaks into your home and steals presents or snags a package off your porch, you'll be able to file a claim with your insurance company. If someone steals your elaborate holiday display on your lawn, that should be covered as well. 

Standard homeowners insurance policies also cover thefts that happen away from your home. So if a person breaks into your car and steals a bunch of gifts, you may be able to file a claim with your home insurer. 

3. Vandalized Holiday Decorations

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.

When does homeowners insurance not cover holiday decorations?

For the most part, your holiday decorations are covered by your homeowners insurance. However, 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.

4. Injured Guests

The holidays can mean hosting duties. If someone gets hurt at your holiday shindig, the medical payments coverage in your homeowners policy can help pay for things like their ambulance ride or x-ray scans. Most insurers offer $1,000 to $5,000 in medical payments coverage. This coverage is designed to pay for a guest's minor-to-moderate medical treatments, regardless of who was at fault. 

If the injury is more severe, you may need to file a personal liability coverage claim to help pay for the more expensive costs of surgery or missed wages if the injury puts them out of work. Personal liability coverage can also help pay for litigation if the injured guest takes you to court over the matter. 

5. Identity Theft

With the increase in online shopping during the holiday season, it's easy to fall victim to hackers and scammers. In fact, a national survey by Experian found that one in four respondents fell victim to fraud during the holidays.  

Some homeowners insurance companies automatically include identity theft protection in their policies, whereas others allow you to add it as an endorsement for an additional fee. Identity theft protection doesn't reimburse you for monetary losses, though. Instead, it helps you get back on your feet after your identity is stolen by covering costs to reverse the fraud, fix your credit score, and get your identity back. 

Holiday Disasters That Aren't Covered by Homeowners Insurance

Not all holiday disasters are covered by your home insurance policy. Here are a few scenarios in which your holiday catastrophe won't be covered.

• Clogged drains or pipes. Homeowners insurance doesn't cover maintenance issues like clogged pipes. That means if you clog your drains or pipes by pouring fat down them or overstuff your garbage disposal, you'll have to foot the repair bills yourself. 
• Intentional acts. Surprisingly, 8% of decoration fires are started intentionally, according to the NFPA. Homeowners insurance never covers intentional acts.
• Drunk driving accidents. Homeowners insurance doesn't cover criminal acts, either. So if someone drinks too much at your holiday bash and drives home, you could potentially be found legally responsible if they get into a car accident and injure a third party. This could be considered a criminal act, and your liability coverage may not cover you. This falls under what is called "social host liability" or "liquor liability," and the rules and regulations surrounding it are very specific and vary by state and insurance company.

Should I File a Claim for Holiday Decorations?

It depends. When you file a homeowners insurance claim for damaged or stolen property, you typically have to pay a deductible before your insurer kicks in the rest. If the stolen or damaged decorations cost less than your home insurance deductible, then it doesn't make sense to file a claim. But otherwise, it could.

For example, if your deductible is set at $500 and your stolen decorations cost $2,000, your insurer would only reimburse you for $1,500.

You should also take into consideration that many insurers will raise your rates after you file a claim. So if you file a claim for low-cost vandalized 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.

What's the Difference Between Actual Cash Value and Replacement Cost Coverage?

When you file a personal property claim, you're typically paid the actual cash value of your items, meaning your insurance reimbursement will take into account the age and condition of your decorations when they were stolen.

This means if your inflatable snowman was 10 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.

How to Avoid a Holiday Disaster Home Insurance Claim

Below are a few tips for avoiding holiday fires and other disasters, according to the NFPA. 

• If your Christmas tree is artificial, make sure it is certified fire resistant.
• Try to find decorations that are fire-resistant.
• Be careful when hanging lights inside or outside, some are only meant for the indoors and others for the outdoors.
• Test your smoke alarms before hosting or cooking a big meal.
• Keep lit candles away from decorations—more than two thirds of decoration fires are started by candles.