If you own your own home then you need homeowners insurance. But an important thing for you to know is that there are no “one size fits all” home insurance policies. The typical home policy will cover a number of things but there is always the scope to tailor this to meet your individual needs. We will take a look at homeowner’s insurance coverage here.
It is essential that you know what your home insurance policy covers and equally importantly what it doesn’t cover. Many people have had the shock of paying for expensive repairs themselves because their home insurance did not cover everything. So here we will take a look at what is covered and what isn’t.
What can you expect from Homeowners Insurance Coverage?
It all depends what type of home insurance policy you have. Most basic homeowner insurance policies (known in the insurance industry as H0-1) will cover your home and possessions if they are destroyed or damaged in certain situations. The most common situations covered by basic home insurance are:
- A strong wind storm (the exception to this is if you live in a high risk hurricane zone)
- Civil unrest
- Hail (not in all areas)
- Vehicles including things thrown from a vehicle
- Aircraft including things that fall from aircraft
- Vandalism (not all policies include this)
- Malicious acts
Although this may seem to be reasonably comprehensive it is not always possible to purchase this basic homeowners insurance. In a number of states you will have to purchase an upgraded policy that has extended coverage.
What is Extended Homeowners Insurance Coverage?
The H0-2 policy in the insurance industry provides extended or upgraded homeowners insurance that will provide you with a greater level of protection for your home and your possessions. With this type of home insurance policy you have coverage against the basics mentioned above and in addition:
- Flooding in your home caused by HVAC, appliances, a sprinkler system or plumbing
- Objects falling on your home
- Electrical damage from artificially generated electric currents (a power surge not from lightning). Usually electronics such as computers are not covered.
- Structure collapse (example termite damage)
- Damaged caused by the weight of snow, sleet or ice
- Breakages to glass
Both the basic and upgraded home insurance policies are very much “what you see is what you get”. If you want to protect your home and possessions against every possible eventuality then you require complete homeowners insurance coverage.
Complete Homeowners Insurance and what it doesn’t cover
This is an H0-3 policy in the insurance industry and it will cover you against most eventualities. If a zombie attack damaged your house then you will be good with this policy. It is best to tell you what this policy does not cover:
- Nuclear accidents
Homeowners Insurance Coverage you may not be aware of
You may be pleasantly surprised to know that your home insurance policy will cover other things as well apart from your property and possessions. It is likely that your home policy will cover these four additional things:
Outbuildings, Hardscaping and Landscaping
Some properties will have outbuildings such as barns and sheds. Hardscaping relates to things like fencing and landscaping is your yard area and any plants that it contains. What normally happens here is that your home policy will cover these areas for around 10% of your total policy (for plants it is usually 5%).
So if your home insurance cover is $150,000 for example you have coverage up to 10% if there is damage to a fence or outbuilding which would be $15,000. Not every situation will have cover though such as damaged caused by high winds.
Personal Possessions Cover
It is a surprise to a lot of people that their home insurance will provide cover for an item usually kept at home that suffers damage or loss away from your home. If you need to take your laptop outside with you and someone steals it then it is likely that you have cover for this.
There is usually a limit to the personal possessions cover and if you have really valuable items such as antiques, jewelry or furs then you will require extended cover for these. Usually personal possessions cover is at cash or replacement value.
Liability Cover for Accidents
Homeowners insurance coverage usually includes injury cover. You will also have coverage in the event of your dog biting someone (medical bill payments) or if a person falls in your home and they are injured. Your family has coverage for home injuries too.
Temporary Expenses for Living away from your Home
If you have suffered damage to your home to such an extent that you cannot live there then most home insurance policies will cover the cost of you living elsewhere such as hotel accommodation and meals. There are usually some limitations here such as you staying in high priced hotels indefinitely and how much you can spend.
Always check your Homeowners Insurance Coverage
Although insurance companies usually work to similar guidelines when it comes to home insurance you should always check the extent of your homeowners insurance coverage. If you find that you don’t have coverage in specific areas then it is usually possible to arrange this for an increased premium.