What is covered by home insurance?
Homeowners Insurance is a property insurance policy that covers losses, damages and liabilities caused by various perils. These perils are called "named perils", in the insurance industry, and include fire, theft and winds. You can also get medical bills paid, as well as lost wages and expenses, if your home is sued by someone for injuries.
What is included in a house insurance policy?
A homeowners policy usually includes a variety of coverages for your home and any other structures you own, as well as personal items. Liability insurance should be included to cover any court costs in the event of a lawsuit for injury or damage to property.
Homeowners' Insurance Policies HO-3 Are Open-Peril Policies
There are two types of homeowner's insurance: comprehensive (HO-05) and modified form (HO-8). The first covers any damage, while the second only covers specific perils. Both options offer some protection against theft, fire and other hazards. However, the latter is more expensive but can prevent large losses, especially if you own expensive items like jewelry or furs.
Home insurance companies often offer HO-3 Policys.
The cost can be calculated on a replacement value or a cash value basis. A replacement cost basis means that if you rebuild your home from the ground up, your insurance company will pay to rebuild it with materials of comparable quality. This can get expensive if you want to add new rooms or even insulation. A policy with an actual cash value, however, only covers the current market value of your home, less any depreciation.
Liability Coverage
A standard homeowners policy will cover damage that occurs on your premises. This is important, especially if there are children playing on your lawn and a pet bites you. This coverage is often accompanied by an individual liability limit, which protects you against claims arising from injuries or property damage that occurs on your premises.
Coverage for Loss of Use
If you have to stay in a hotel or pay other temporary expenses while your house is being rebuilt, a loss of use claim can help. The amount of coverage will vary by policy but typically ranges between 20% to 50% of your total policy.
Personal Property Coverage
The majority of homeowners policies replace furniture, electronics and personal possessions that are damaged during a covered event. Some homeowners' insurance policies cover high-value items, such as jewelry and art.
Liability Coverage
Liability coverage is a part of your homeowners insurance that protects you from lawsuits resulting from injuries or property damage on your premises. This part of your home insurance policy also pays for the medical bills, lost wages and other expenses that occur as a result of injury or damage to someone else on your property.
ALE Endorsement
This endorsement will pay for the restoration or repair of your home in order to meet new building codes and ordinances which were in effect when it was built. It may be necessary to pay a small premium for this endorsement, but you will have peace of mind.