What is Home Insurance?

Home insurance, also commonly called hazard insurance or homeowner's insurance is a type of property insurance that covers a private residence. 

It is an insurance policy that combines various personal insurance protections, which can include losses occurring to one's home, its contents, loss of use (additional living expenses), or loss of other personal possessions of the homeowner, as well as liability insurance for accidents that may happen at the home or at the hands of the homeowner within the policy territory.

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Typical Home Insurance Coverages

Section I — Property Coverages

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• Coverage A – Dwelling
  Covers the value of the dwelling itself (not including the land). Typically, a coinsurance clause states that as long as the dwelling is insured to 80% of actual value, losses will be adjusted at replacement cost, up to the policy limits. This is in place to give a buffer against inflation. HO-4 (renter's insurance) typically has no Coverage A, although it has additional coverages for improvements.

• Coverage B – Other Structures
  Covers other structure around the property that are not used for business, except as a private garage. Typically limited at 10% to 20% of the Coverage A, with additional amounts available by endorsement.

• Coverage C – Personal Property
  Covers personal property, with limits for the theft and loss of particular classes of items (e.g., $200 for money, banknotes, bullion, coins, medals, etc.). Typically 50 to 70% of coverage A is required for contents.

• Coverage D – Loss of Use/Additional Living Expenses
  Covers expenses associated with additional living expenses (i.e. rental expenses) and fair rental value, if part of the residence was rented, however only the rental income for the actual rent of the space not services provided such as utilities.

• Additional Coverages
  Covers a variety of expenses such as debris removal, reasonable repairs, damage to trees and shrubs for certain named perils (excluding the most common causes of damage, wind and ice), fire department changes, removal of property, credit card / identity theft charges, loss assessment, collapse, landlord's furnishing, and some building additions. These vary depending upon the policy.

• Exclusions
  In an open perils policy, specific exclusions will be stated in this section. These generally include earth movement, flooding, mold, power failure, neglect, war, nuclear hazard,  intentional loss, and concurrent causation. 

• Floods
  Flood damage is typically excluded under standard homeowners and renters insurance policies. Flood coverage, however, is available in the form of a separate policy both from the National Flood Insurance Program (NFIP) and from a few private insurers. 

• Coverage E – Personal Liability
  Covers damages which the insured is legally liable for.. About a third of the losses for this coverage are from dog bites.
  
  Contact us to learn more about the right homeowners insurance for you.