| > | | | | Most standard policies also cover detached |
| When it comes to homeowners insurance, you | | | | structures such as garages, storage sheds, and |
| should understand the different types of policies | | | | fixtures attached to the land such as fences, |
| available so that you can make an informed | | | | driveways, sidewalks, and retaining walls. These |
| decision. | | | | kinds of structures are usually covered for about |
| Whether this is the first time you are shopping | | | | 10% of the amount of coverage you have on |
| for a homeowners insurance policy or if you | | | | your home. If you believe you need more |
| currently have a policy, it is always a good idea to | | | | coverage on these structures, make sure you |
| be well educated to make sure you have your | | | | talk to your insurance agent. If a detached |
| home properly and adequately covered. It's also | | | | structure is used for a business purpose, it is not |
| important to know what your deductible is. | | | | covered under a homeowners insurance policy. |
| Standardized HO (homeowners) insurance policies | | | | 3. Your Personal Belongings |
| include: | | | | Items such as furniture, clothing, and sports |
| HO-A provides extremely limited actual cash value | | | | equipment are covered if they are stolen or |
| coverage for your home and contents. Only the | | | | destroyed by insured disasters. Some policies |
| types of damage specifically listed in the policy | | | | may have limited coverage for small boats but |
| are covered. HO-A amended policies provide more | | | | not motorized vehicles unless they are unlicensed |
| extensive coverage than the base HO-A but less | | | | and only used at your home. Some belongings or |
| coverage than an HO-B. | | | | items may have limited coverage. These could |
| HO-B provides replacement cost coverage for | | | | include artwork, firearms, electronic data and |
| most types of insurable perils, except for | | | | money. Usually you have 50% to 70% of the |
| exclusions. | | | | amount of insurance you have on the structure |
| HO-C policies provide the most extensive | | | | of your home. It is very important to conduct a |
| coverage. | | | | home inventory to determine if you have enough |
| When you shop for homeowners insurance, it is | | | | coverage to replace these belongings. |
| very important that you know what your policy | | | | Costly items such as silverware, jewelry, and furs |
| covers. Your policy is designed to protect | | | | are covered but there are usually dollar limits. |
| homeowners from insurable perils. These perils | | | | Your coverage even includes "accidental |
| can include fire, theft, hurricanes and several other | | | | disappearance," meaning if you lose the item it is |
| events. Your individual policy is determined by | | | | covered by your policy. However, there is no |
| named perils and exclusions. Policies can differ | | | | deductible. To insure expensive belongings for |
| from homeowner to homeowner. With your | | | | their full limits you need to buy a special personal |
| agent's help, you can determine how much | | | | property endorsement. |
| coverage you and your family need. | | | | Trees, plants and shrubs are also covered under |
| To receive full payment (minus your deductible) | | | | the Personal Belongings part of your policy as long |
| for a partial loss, you must insure your house for | | | | as they were damaged by insurable perils. They |
| at least 80% of its replacement cost. If you | | | | are not covered if the damage occurred from |
| insure for less, the insurance company will only | | | | wind or disease. The coverage is usually 5% of |
| pay for part of the expense of a partial loss. If | | | | the insurance on your home. |
| your home is destroyed and you only have actual | | | | Your policy also includes off-premise coverage |
| cash value coverage, you may not be able to | | | | anywhere in the world. Sometimes the limit is |
| completely rebuild with the claim payment you | | | | 10% of the amount on the policy. |
| receive. | | | | Your policy includes up to $500.00 of coverage |
| With any policy there are exclusions. Your policy | | | | for unauthorized use of your credit cards. |
| typically does not cover injuries to animals or | | | | 4. Additional Living Expenses (Or Loss of Use) |
| damage to motor vehicles or aircraft. You also | | | | This part of your policy covers any additional |
| are usually not covered for losses due to floods, | | | | expenses you may have above and beyond your |
| mudslides, water damage from sewer backups, | | | | normal living expenses if you cannot live in your |
| damage from war or nuclear hazards, neglect, | | | | home due to damage caused by insurable perils. |
| earthquakes, power failures, seepage, dry rot or | | | | This means hotel costs, meals, and other living |
| vermin. | | | | expenses are covered while your home is being |
| Homeowners insurance policies have different | | | | repaired or rebuilt. The amount available to pay |
| covered perils and exclusions. Check your policy | | | | for these expenses is usually equal to 20% of the |
| carefully so you understand the kinds and extent | | | | insurance on your house. If you rent part of your |
| of coverage you have. | | | | home, the loss of income will be reimbursed. |
| Five Key Home Insurance Coverage Types | | | | Policies differ company to company. Make sure |
| The rates you pay for your standard | | | | you know what is covered. This part of your |
| homeowners insurance policy includes the following | | | | insurance policy is to help you maintain a "normal |
| essential types of coverage: | | | | standard of living." |
| 1. Coverage for the structure of your home. | | | | 5. Liability Protection |
| 2. Coverage for other structures. | | | | Liability protection provides personal liability |
| 3. Coverage for your personal belongings. | | | | coverage against lawsuits for bodily injuries or |
| 4. Additional living expenses (ALE) also known as | | | | property damage that you or other members of |
| loss of use. | | | | the family who live in the home cause others on |
| 5. Liability protection. | | | | your property. It also covers any damage or |
| 1. The Structure of Your Home | | | | injury your pet may cause. This part of your |
| Coverage for the structure of your house is the | | | | policy includes no-fault medical coverage so |
| part of your policy that includes repairs or | | | | medical expenses are paid with no liability claim |
| rebuilding if your home (dwelling) was damaged by | | | | filed against you. The cost of defending you in |
| fire, hurricane, hail, lightning or other disasters | | | | court and court awards are covered, up to the |
| listed in your policy. Your "dwelling" typically | | | | limit of your policy. This coverage covers you, |
| includes your house, attached structures and | | | | your family members, or your pets anywhere in |
| fixtures in your house such as built-in appliances, | | | | the world. |
| plumbing, wiring, heating systems, and | | | | Home insurance experts highly recommend that |
| permanently installed air-conditioning systems. This | | | | you buy at least $300,000 worth of protection. |
| coverage does not include damage caused by | | | | You can also buy an umbrella or excess liability |
| floods, earthquakes or routine wear and tear. | | | | policy. This kind of policy covers you for slander |
| When you buy your homeowners insurance, it is | | | | or libel claims. These policies cost between $200 |
| very important that you purchase enough to | | | | to $300 for every $1 million of additional |
| rebuild your home. | | | | coverage. |
| 2. Coverage for Other Structures | | | | |