Homeowners Insurance

Homeowners coverage provides financial protection against loss due to disasters, theft and accidents. Most standard policies include four essential types of coverage: Coverage for the structure of your home; Coverage for your personal property; Liability protection; Coverage for Additional Living Expenses.

• Coverage for the structure of your home:

Your homeowners policy pays to repair or rebuild your home if it is damaged or destroyed by fire, hurricane, hail, lightning or other disasters listed in your policy. Generally, Homeowners policies also cover “other structures” such as a garage, shed, patio, swimming pool and more.

Keep in mind that a standard policy does not pay for damage caused by a flood, earthquake or routine wear and tear.

The policy limit covering your dwelling should be its “reconstruction value”, not its market value, tax value or appraised value. A good agent will help you determine this value.

• Coverage for your contents (also know as personal property):

Personal belongings coverage includes your furniture, electronics, clothes and more. Your contents are covered anywhere in the world, but those regularly kept at another residence are limited to 10% of your contents limit.r possessions. You also have up to $500 of coverage for unauthorized use of your credit cards.

Expensive items like jewelry, furs, art, collectibles and silverware are covered, but there are usually dollar limits if they are stolen. To insure these items to their full value, purchase a special personal property endorsement or floater and insure the item for its officially appraised value.

• Liability protection:

Liability covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. It also pays for damage or injuries caused by your pets (think dog bites!).

The liability portion of your policy pays for both the cost of defending you in court and any court awards—up to the liability limit stated in your policy.

Liability limits generally start at about $100,000, however, it is really not expensive to increase this limit to $300,000, or better yet, $500,000.

• Additional living expenses:

“Additional Living Expenses” pay the additional costs of living away from home if you cannot live there due to damage from a covered insurance claim. It covers hotel bills, restaurant meals and other costs, over and above your usual living expenses, incurred while your home is being repaired after a claim.