Peace of mind comes standardHome insurance helps minimize repairs, replacement costs and living expenses if something happens to your house or townhome. Fire, wind, hail, lightning, theft—you’re covered. Just select what you pay out of pocket if you have a claim (usually somewhere between $500 and $1,000), and your homeowners insurance policy takes care of the rest.
See what’s covered and not covered by home insurance
Standard home insurance coverage policies provide the following types of coverage, up to the limits outlined in the policies:
- Dwelling — Pays for damage or destruction to your house and any unattached structures and buildings, such as fences, detached garages, and storage sheds.
- Personal Property — Covers the contents of your house, including furniture, clothing and appliances, if they are stolen, damaged, or destroyed.
- Liability — Protects you against financial loss if you are sued and found legally responsible for someone else’s injury or property damage.
- Medical Payments — Covers medical bills for people hurt on your property. Medical Payments coverage also pays for some injuries that may happen away from your home, such as if your dog bites someone.
- Loss of Use — Pays for additional living expenses if your home is too damaged to live in during repairs. Most standard home insurance coverage pays 10 to 20 percent of the amount of your dwelling coverage.
You also can purchase the following optional home insurance coverages:
- Guaranteed Replacement Cost — Provides the most complete coverage for your home. Your home insurance company requires you to meet specific underwriting rules and conditions to qualify for this coverage. For instance, you may need to increase your home insurance amount on a monthly, quarterly or yearly basis to keep up with the inflation rate.
- Inflation Guard Endorsement — Automatically adjusts your home insurance limits during your policy period so they are at 80 percent or more of your home’s replacement cost, which is the amount most home insurance companies require you to have. This coverage is beneficial if your home’s replacement cost is increasing with inflation.
- Scheduled Personal Property Endorsement — Also called a personal article floater. With this coverage, possessions, including jewelry, furs, stamps, coins, guns, computers, antiques, etc., are covered. Each article is itemized and detailed in the floater, and excluded perils also are outlined. Personal article floaters often do not have deductibles.
- Increased Limits on Money and Securities — Increases coverage amounts for money, bank notes, securities, deeds and more
- Secondary Residence Premises Endorsement — Covers a secondary residence, such as a summer home. Insurance for secondary homes is not automatically provided by the home insurance policy you have for your primary or principal residence, so it’s important to consider this endorsement if you own more than one home.
- Watercraft Endorsement — Expands personal liability and medical payments coverage for small sailboats and outboard motor boats only.
- Theft Coverage Protection Endorsement — If items from your motor vehicle, trailer or watercraft are stolen, theft coverage protection broadens theft coverage without requiring proof of forcible entry.
- Credit Card Forgery and Depositors Forgery Coverage Endorsement — Coverage applies if your credit cards are lost, stolen or used without permission, or if someone forges a check, draft, promissory note, etc. Certain restrictions apply and are noted in your home insurance policy.
What is not covered by home insurance
A standard homeowners policy may not protect you from:
- Flood, Earthquake, Nuclear Accident and War — To protect against unforeseen and uncontrollable events like these, you can purchase hazard insurance through your home insurance policy.
- Windstorm Damage — In certain areas (mostly coastal) of some states, standard home insurance coverage does not cover damage caused by windstorms and hail. Check your policy information to see if windstorm damage is covered in your area.
Questions to ask before you buy home insurance
- Is flood insurance required, and what kind of flood insurance is available?
If you live in a flood plain and you have a mortgage, you may be required to have flood insurance. Depending on where your home is located, you may qualify for flood insurance through the National Flood Insurance Program. Some insurance companies also offer flood insurance. Keep in mind that your home could sustain flood damage by other means, such as broken pipes, even if it’s not located in a flood plain, so consider this coverage if you are eligible for it.
- Is earthquake insurance available?
Most insurance companies offer earthquake insurance for an additional cost. This insurance generally is attached to your home insurance policy as an endorsement. If you live in California, coverage is available from the California Earthquake Authority.
These are just a couple of the key questions to ask when purchasing homeowners insurance, Let us help you find the answers Today!
Below is a list of frequently asked questions about homeowners insurance
What factors can affect homeowners insurance premiums?
The following factors can affect your homeowners insurance premium:
- Home Features and Characteristics — Your home’s age, type of structure, wiring, roof, garage, etc., can affect your homeowners insurance premium. Older homes can often cost more to insure, and those costs can differ depending on whether your home is brick, frame, stone or has synthetic siding.
- Location — Where your home is located can change your homeowners insurance premium. For instance, your home insurance rate can be affected if your home is in close proximity to a fire station; is exposed to extreme weather, such as hurricanes, tornadoes or earthquakes; or is in a neighborhood more prone to theft.
- Protective Devices — Burglar alarm systems, smoke detectors, fire extinguishers, sprinkler systems and deadbolt locks can lower your homeowners insurance premium.
- Personal Factors — What you do can affect your homeowners insurance premium, too. For instance, smokers may pay more for home insurance than nonsmokers. A good credit history also can lower what you pay for home insurance.
- Claims History — If you have a history of claims on a homeowners insurance policy, you may pay a higher premium.
Am I required to have homeowners insurance if I own a home?
Unlike driving a car, you can legally own a home without homeowners insurance. However, if you finance your home with a mortgage, your lender most likely will require you to have home insurance coverage to protect your home in case of damage cause by unforeseen circumstances, such as fires or natural disasters.
If you live in an area that is prone to flooding or earthquakes, your lender may also require you to purchase flood insurance or earthquake insurance.
After you pay off your mortgage, you aren’t required to have home insurance. However, you should keep your home insurance policy active to avoid risking what you’ve invested in your home. (I moved this sentence up instead of it being last. It makes more sense here.)
If you purchase a condominium or co-op, your board may require you to buy condo insurance or home insurance. Be sure to check with your board to see what type of policy is required.
If you’re looking to insure a townhouse and your townhome association has a master policy (which typically covers the structure and common areas), you’ll get renters insurance. If your association does not have a master policy, you’ll get homeowners insurance.
Why should I complete a home inventory?
When you purchase a home and a homeowners insurance policy, you should create an up-to-date home inventory to expedite a claim settlement if you ever need to make one. With a complete home inventory, your insurance company can verify property easier, which makes settling your claim easier. Plus, you can easily verify losses for your income tax return with an updated home inventory.
How do I complete a home inventory?
Start your home inventory by making a list of your possessions, describing each item, and noting the make and model and where each item was purchased. Include sales receipts, purchase contracts and appraisals if you have them, too. Organize clothing into categories for easier reference.
A few home inventory organization tips:
- Take pictures of rooms and important individual items.
- Videotape your home by walking through it and describing the contents throughout the house.
- Save an inventory list on your personal computer and store it on a separate disk or drive.
- Put all your photos, lists and videotape documentation in a safe deposit box.
What's the difference between canceling and nonrenewing a homeowners insurance policy?
Canceling a homeowners insurance policy and choosing not to renew it are two very different actions an insurance company can take.
Typically, insurance companies can only cancel an active policy if one or all of the following occurred:
- The policy has been in force less than 60 days
- You fail to pay the premium
- You commit fraud or made serious misrepresentations on your application
What parts make up a homeowners insurance policy?
Although homeowners insurance policies differ in their actual structure, most contain the same basic components:
Declarations Page — Usually the first page of your homeowners insurance policy, it typically contains the following summary information:
- Name and address of the insured
- Dollar amount of coverage in the policy
- Description of the insured property
- Cost of the insurance
- Name of the insurance company insuring the risk
- Contact information
Coverage — Details the extent of protection for both property (house, structures, contents) and liability (bodily injury or property damage to others for which you are liable) in your homeowners insurance policy.
Exclusions — Explanation of what is not covered by your homeowners insurance policy, under both property and liability coverage.
Conditions — Outline the responsibilities of both the insured and insurance company under the policy. Your duties in the event of a loss and also the procedures the company will follow to settle any losses are detailed here.
Endorsements — Riders, amendments or attachments that alter the standard coverage provided by your home insurance policy. If you choose endorsements for your policy, you may pay an additional premium for them.