Trampolines, swimming pools, treehouse kits and certain breeds of puppies are holiday gifts that make children bubble over with glee, but they cause homeowner's insurance agents to cringe.
It is easy to forget during the holiday excitement, but many backyard or playroom items can give you insurance headaches. It comes down to how the risks inside and outside your property compare with injury statistics.
"It's not your kids that the insurance companies are worried about," says Richard Lundin, an insurance agent in Park Ridge, Illinois. "It's the guests, those neighborhood kids. The liability from visiting children who might get hurt."
Because every homeowner's situation is different and every state has its own insurance regulations, Loretta Worters, vice president of the Insurance Information Institute in New York, would not speculate about how much someone's rates might go up after Santa brings the kids a trampoline.
However, Lundin says he has seen rates climb after homeowners have bought items like trampolines and in-ground pools, and people have lost their policies for not revealing the purchases to their agent.
To be sure, some gifts that you might think would sound alarm bells, like a swing set, playground fort or those costly motorized toy cars that look like miniature versions of the real thing, will not affect your policy. Buying your kid a minibike will not change your homeowner's insurance, but you should add it to your auto coverage.
Whatever the chosen plaything, Nationwide agent Renae Dusenbury-Waldman of Tryon, North Carolina, says her customers will not see their rates rise, and their insurer will not drop them, if they follow strict safety guidelines.
Dusenbury-Waldman backed up this approach when some of her customers, who are also family friends, bought a trampoline three years ago for their four children as a Christmas gift.
"My own daughter broke her arm on my neighbor's trampoline," she says.
This was one of many trampoline-related accidents.
In 2010, the most recent year statistics are available, there were 92,159 hospital emergency room-treated injuries associated with trampolines, according to the U.S. Consumer Product Safety Commission. Meanwhile, the American Academy of Pediatrics has estimated that about one in 200 injuries on trampolines lead to permanent neurological damage.
Dusenbury-Waldman made sure her friends put in enough safety measures to keep the insurance company happy.
Trampolines need to be anchored to the ground to prevent them from blowing into another yard, she says, and they need to be kept in a fenced-in yard or 1,000 feet from another house. There should also be a lock around the netting, keeping out neighborhood kids.
Donna Milligan, an insurance agent in Wooster, Ohio, also stresses safety precautions for pools, and says that the biggest no-no's are diving boards and slides, which are both prone to causing injuries.
WHEN TO TELL?
If you throw caution to the wind and build something like a treehouse, you should know the risk if you do not tell your agent.
"If you knowingly don't say anything, you're defrauding your insurance company," says Worters of the Insurance Information Institute.
You could lose your insurance when it comes time for renewal if a home adjustor comes onto your property and sees the hideaway in your oak tree.
According to the Center for Injury Research and Policy in Columbus, Ohio, 2,800 children annually are involved in tree house injuries. If you end up having to report one, you may find you are not covered, or you may get dropped at renewal time.
What is most likely to happen, however, is absolutely nothing - unless later you're looking for another policy.
"You're probably going to run into a lot of insurance companies that say, 'Sorry, we're going to have to pass,'" says Milligan, speaking for the nine insurance companies she works with.
This can be very troubling if your beloved holiday gift was, say, a Rottweiler puppy, which is a little harder to disassemble than a swing set.
In 2011, more than a third of homeowner's insurance liability claims were due to dog bites, costing almost $479 million, according to the Insurance Information Institute. And when it comes to such injuries, pit bulls and Rottweilers lead the pack, insurance experts say.
Milligan says a client who was shopping around for a new policy kept getting turned down by insurers that wanted nothing to do with her pet Rottweiler.
"What are we supposed to do?" the woman asked. "It's a good dog."
Milligan does not doubt it, but all she could advise was to keep looking. "Someone will insure her, I'm sure," she said, "but at a high price."