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4 Things You Should Know about Homeowners Insurance

1. What is covered? Maybe you just bought your first home, and along with one of the biggest purchases you have ever made, you’ve also purchased homeowners insurance. The problem: you’re not really sure what it covers. Most standard homeowners insurance policies include the following types of coverage:

  • Dwelling coverage: covers the physical structure
  • Personal Property coverage: covers the personal belongings inside the home
  • Adjacent Structures coverage: covers additional structures on the property, such as detached garages and sheds
  • Personal liability coverage: this covers costs related to any bodily injury sustained by someone who does not live in your home
  • Additional expenses coverage: this includes extra living expenses that might come up due to a natural disaster, and you’re displaced from your home by the requirement of an evacuation

Usually, homeowners insurance is required by the lender to obtain a mortgage. Plans and protection vary by state.

2. Does homeowners insurance cover fires? Yes. When homeowners insurance coverage first came popularized in the 1800s, it was referred to as Fire Insurance. Homeowners insurance also covers financial loss caused by weather (like lightening, hail, and windstorms, including tornadoes) and catastrophic events (like explosions).

3. What is the difference between actual cash value dwelling coverage and replacement cost dwelling coverage?

Actual cash value dwelling coverage is what it would cost to replace your home and belongings after deducting depreciation (how much the items are currently worth, not what you paid for them).

Replacement cost value dwelling coverage is what it would cost to replace your home and belongings without the deduction for depreciation.

4. Where and when is my personal property covered? Personal property (except property that is specifically excluded) is covered anywhere in the world. For example, suppose that while traveling, you purchase a dresser and you want to ship it home. Your homeowners insurance policy would provide coverage for the “named perils” while the dresser is in transit – even though the dresser has never been in your home before.

If you’re interested in a homeowners insurance quote or have any questions, please contact us at 844-343-9408 or Contact us online.

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