4 big things homeowners insurance doesn't cover — and what you can do to protect yourself

Homeowners insurance can keep what's probably your biggest purchase safe. And if you have a mortgage, you probably have to take out a policy.

A standard homeowners insurance policy, sometimes referred to as an HO-3, will cover your dwelling, belongings and personal liability under many common situations, including theft and fire.

But even the best policy doesn't cover everything. We look at several scenarios that are excluded from homeowners insurance policies and explain how you ensure you're protected.

"There are a lot of consumers who are unaware that their home insurance policy won't cover a flood," said Charlie Wendland, vice president and head of claims at Branch, an Ohio-based insurance company. "They just think 'Oh, this must be covered by my policy.' And often it's not."

To cover flood damage you can either work with an insurer that underwrites its own flood policies or one that partners with the National Flood Insurance Program (NFIP), a division of the Federal Emergency Management Agency (FEMA).

The NFIP underwrites more than 90% of the flood policies in the US, with an average annual premium for of $851 in 2023. (You can find participating insurers on NFIP's flood insurance provider tool.)

There are drawbacks to NFIP coverage, however: Premiums can be higher and policies don't cover basement contents, external buildings or pools and don't provide temporary living expenses. In addition, payouts are typically capped at $250,000 for dwellings and $100,000 for belongings.

For more robust coverage, you'll have to get private flood insurance. CNBC Select recommends Neptune Flood Insurance for its widespread availability and high limits (up to $4 million for building coverage and up to $500,000 for contents).

Homeowners insurance also doesn't cover damage caused by earthquakes or landslides.

An earthquake insurance policy can help you rebuild your home, replace personal belongings and cover your living expenses while repairs are being done. It covers fires caused by a quake, though flooding would require separate flood insurance.

Earthquake insurance looks different from state to state. In California, for example, insurers are required to offer earthquake insurance, though buying it is optional.

Most insurance policies cover valuables but "things like jewelry and silverware typically carry a pretty small limit," according to Wendland.

A standard policy caps theft coverage for jewelry at about $1,500. If your items are worth more, you can protect them one of three ways: By raising the limit on your policy, by "scheduling" each piece with separate floater policies or by buying a separate jewelry insurance policy not tied to your home insurance.

Scheduling each item means your premiums will be higher— and you'll need to get them appraised by a professional — but it typically covers any kind of loss, from theft to accident.

A standalone jewelry insurance policy will replace your ring, watch, or other valuables in the event of a loss or theft.

Annual premiums on jewelry insurance typically cost about 1% to 2% of the item's value. While you'll need to get it appraised, if you have to file a claim it won't impact your homeowners insurance premiums.

Founded in 1913, Jewelers Mutual is a standout for its long history and its coverage of preventative maintenance — like replacing old clasps and tightening settings.

If you have exceptionally expensive pieces, Chubb's Jewelry Insurance specializes in high-value items. Chubb's valuable articles insurance covers artwork, wine, sports memorabilia and other collectibles.

The average home insurance policy only provides a small amount of coverage for business-related equipment, according to the Insurance Information Institute, usually about $2,500. You can add a home-based business to your policy, but it'll likely max out at about $10,000.

If your merchandise, equipment or other physical assets are worth more, you'll want to get a business owners policy, or BOP. In addition to damages, BOPs usually cover things like liability and business interruption and may include spoilage, forgery, theft and equipment breakdown.

CNBC Select named Nationwide the best insurer for small businesses. Available in all 50 states, it earns high marks for customer satisfaction and offers a BOP that combines coverage for commercial property, liability, business income and equipment breakdown. 

Next Insurance is a standout for independent contractors, with rate quotes available online and certificates of insurance available immediately.

Homeowners insurance can give you the peace of mind that comes with knowing your home and belongings are protected. But there are several in a variety of situations. However, it's important to know which situations are not covered by standard home insurance policies.