Your home is your sanctuary, so why leave it vulnerable to loss? More than just a dwelling, your home is full of memories and treasured belongings. Infinity Insurance Agency, Inc. (IIA) recognizes the value of proper homeowners’ coverage. While no one plans for a house fire or burglary, these unfortunate events are not uncommon. A homeowners’ policy is a package insurance policy providing property and liability coverages (III). As a homeowner, it is important to understand what homeowners’ insurance might cover to help you make informed decisions about your level of coverage.
What is homeowners insurance?
Whether you live in a mobile home or have just purchased your dream property, your residence is filled with more than memories. Your home is the resting place for your valuables such as furniture, appliances, and clothes. Homeowners insurance can potentially provide coverage against material losses if your house is damaged or destroyed by a fire, weather, vandalism, theft, or non-flooding water damage (NAIC). Generally, homeowners’ insurance will cover both the structure of your home and your personal property in addition to third-party injuries that may occur on or off your property. Many homeowners opt to purchase this coverage to soften the financial loss of a disaster or to satisfy their mortgage lender. (NAIC)
Core coverages in a homeowners insurance policy
What coverages are included in a homeowners insurance policy? Typically, homeowner's policy coverage will include four types of essential coverage:
- Dwelling Coverage: This type of coverage can help pay to repair or rebuild your home (up to your policy limit) in cases of covered structural damage. Generally, this coverage will extend to damages caused by fire, vandalism, hail, lightning, or other disasters as stated in your policy. Some policies may extend coverage to detached structures such as a garage, tool shed, or gazebo.
- Personal Property Coverage: This type of coverage is designed to help cover costs associated with replacing or repairing personal items, such as furniture, clothes, and appliances if they are stolen or destroyed by a covered disaster. (III). Personal property coverage can potentially extend to items stored off-premises and may pay for personal belongings (furniture, electronics, clothing) inside the home, or even when off-premises.
- Liability Coverage: This type of coverage can help cover you for your obligation to pay damages arising out of legal liability to a third party.
- Additional Living Expenses (ALE): This part of your policy can help cover additional living expenses (up to your policy limits) of living away from your house if you cannot live there due to damage incurred from a covered disaster such as a fire. ALE can extend to hotel costs, restaurant meals, and other costs incurred while your home is being repaired or rebuilt. Please note that like all coverage, ALE will have limits and might even include a time limit.
Common perils covered
So, what does homeowners insurance cover? The specifics of your homeowner's insurance will differ depending on your selected coverages, policy limits, and deductibles.
The property coverage under a basic homeowner's policy typically will extend coverage for direct damage to property caused by the following common perils:
- Fire and smoke damage
- Theft and vandalism
- Weather events including storms, hail, and lightning
- Non-flood-related water damage, such as leaky pipes
What isn’t covered by homeowners’ insurance?
Standard homeowners insurance policies will usually not extend coverage for the following events, items, or instances:
- Natural disasters - Natural disasters such as hurricanes, floods, and tornados will typically not be covered by basic homeowners’ insurance. To obtain coverage for natural disasters such as floods and earthquakes you might need to acquire a separate policy.
- Routine wear and tear - Normal maintenance or repair of your home’s structure or personal belongings may not be covered.
- High-value items - Typically these items will only be covered up to the policy’s standard limit. These limits may fail to fully cover expensive antiques, jewelry, or collectibles, but homeowners can purchase a special personal property endorsement or floater to help cover these more expensive items.
- Mold and infestations - Generally homeowner's policies will not extend coverage to the cost of damage from mold or infestations caused by termites or rats.
Factors that affect homeowners’ insurance premiums
Like personal auto insurance, several factors will influence your homeowner's insurance costs including but not limited to:
- The value, age, and condition of your home
- The location of your home as it relates to both crime rates and natural disasters
- The type of construction of your home
- Your home’s access to local fire protection, police support, and the water supply
- Your deductible amount and amount of coverage selected
- Safety features such as smoke detectors, security systems, and deadbolt locks
The thought of losing your home and all your belongings in a single instance can be terrifying. Having a homeowners insurance policy can help you prepare for the unexpected. Whether you already have homeowners’ insurance or want to re-evaluate your coverage, it is imperative to continuously educate yourself on your coverage and conduct routine home inventories. By keeping track of changes to your dwelling and major purchases you can more effectively decide how much coverage you feel comfortable with.
Infinity Insurance Agency, Inc. (IIA) may not offer homeowner’s coverage, but we are available for your auto insurance needs. Up to date auto coverage is essential, and our team of bilingual-Spanish agents are available to review and advise on your current policy.
Reach out to an IIA agent today at 1-855-478-3705 for a free quote!