Homeowners Insurance

If you’re like most people, your home represents your largest single investment. So don’t put your financial security at risk by failing to protect your investment with inadequate or no home insurance.

Home insurance not only protects your home, it offers you protection from legal liability for accidents occurring on or near your property. Before you buy a home insurance policy, it’s helpful to understand the range of coverage provided so you know what to expect and what you’re really paying for.

The coverage provided by a home insurance policy is usually divided into separate categories based on the nature of the protection provided. A typical home insurance policy has six categories of coverage:

1. Dwelling
2. Other Structures
3. Personal Property
4. Liability
5. Additional Living Expenses
6. Loss of Use.

Each of the above categories is described below:

• Dwelling

  The main coverage is for the dwelling itself – that is the structure of your home (excluding your land). You need enough coverage to meet the cost of rebuilding your house if it is damaged or destroyed. The amount of coverage chosen for your dwelling is also used to determine the amount of insurance provided in some of the other categories of coverage, as detailed below

• Other Structures

  In addition to your house, you may have other structures on your lot, detached from your house. These might include a garage, workshop or pool house. Most policies provide coverage for detached structures of up to 10 percent of the amount of insurance obtained for your dwelling.

• Personal Property

  In addition to coverage for your dwelling and other structures, you also need protection for the items in your home, such as your appliances, furniture and other personal belongings. This is known as personal property coverage. Most policies provide personal property coverage of up to 50 to 70 percent of the amount of insurance obtained for your dwelling. This is generally more than sufficient for most families. It’s also good to know that most policies provide off-premise coverage, which means that your possessions are protected even if they are not on your property.

• Liability

  Liability coverage is often the most overlooked aspect of home insurance, but it can be one of the most important coverages. It provides you with legal personal protection against property damage and bodily injury lawsuits and includes no-fault medical coverage for any guests injured in your home.

• Additional Living Expenses

  Additional living expenses coverage provides reimbursement of certain living costs, such as hotel and restaurant bills, if you are temporarily unable to inhabit your home due to damage caused by an insured peril.

• Loss of Use

  Loss of use coverage provides you with compensation for loss of income if you are temporarily unable to use your home to generate income due to damage caused by an insured peril. This most commonly applies to homeowners who normally rent out a room or part of their home to another person.

Some policies also provide coverage for other costs and expenses such as damage to trees and shrubs (except due to wind and ice), fire department charges and loss assessment fees.