Explaining Homeowners Coverage

A standard home insurance policy includes six basic types of coverage:HO-image

Coverage A- Dwelling
Coverage B- Other Structures on Your Property
Coverage C- Personal Property/Contents
Coverage D- Loss of Use
Coverage E- Personal Liability Protection
Coverage F- Medical Payments

Dwelling – Coverage A: Protects in case of damage or possible loss to your home in the event of a covered loss like a fire, wind, tornado or lightening.

Other Structures – Coverage B: Structures protected by a normal homeowners policy include detached garages, outbuildings, fences, sidewalks, etc. that are located on your property.
Most policies default 10% of dwelling coverage for this coverage. Example: $100,000 on building would automatically grant you $10,000 on other structures.

Personal Property – Coverage C: Is included in a typical homeowners policy and insures your household contents if they are stolen or destroyed by fire, wind or other covered loss in your policy. Here it is IMPORTANT to make sure you ask for Replacement Cost option.   Otherwise that $3000 sound system that is now 5 years old may be depreciated to $800 if you were to have a loss without  Replacement Cost.  The other option is Actual Cash Value and this brings into play depreciation.  Always ask for Replacement Cost coverage.

Loss of Use – Coverage D: In case of a covered loss you had to be away from your home while it is being repaired you would have coverage to relocate you during this time. This would include hotel or rent, restaurant bills, dry cleaning, and etc. incur during the time your home is being repaired.

Personal Liability Protection – Coverage E: Coverage begins if a civil suit brought against you or a covered family member for bodily injury or property damage. Household pets would be covered in a covered loss, farm animals would not be considered  household pets.  So if your Llama bites your neighbor …you better have farm coverage because your Homeowners will not cover it.  Call us we can help… 🙂

Generally a standard policy will include $100,000 Personal Liability.  PLEASE …for just a few dollars more per year you can increase that coverage to $500,000.  We live in a litigious society, you don’t want to risk a huge loss that could require you to sell your home and other assets to pay a judgment.  For an example …see YOU POSTED WHAT

Medical Payments – Coverage F: If someone is hurt on your property at no fault or blame to you, your insurance will pay up covered amount as a good faith payment.

If you have other questions about homeowners insurance or how to get started, please contact us to have one of our experienced licensed agents answer any and all of your questions.

It can be confusing….so let us help.

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