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Homeowners Insurance 101

Thinking of protecting one of your biggest investments with homeowners insurance? Smart move!


However, it's crucial to understand the basics of homeowners insurance. Knowing what's covered and what isn't goes a long way in helping you rebuild your home and replace lost items when disaster strikes.



What is Homeowners Insurance?

Homeowners insurance is a policy that protects your home and provides the cost of replacement or repair for your belongings in the event they're stolen or damaged. It also helps pay the cost of medical bills if you or someone gets injured on your property.


Types of Homeowners insurance

There are eight standard types or policy forms of homeowners insurance policy. These are HO-1, HO-2, HO-3, HO-4, HO-5, HO-6, HO-7, and HO-8. Each of them offers different levels of coverage, with some offering more expansive coverage than others. The most common types of homeowners insurance are HO-3 and HO-5.


What does homeowners insurance provide?

Homeowners insurance covers:


Damage to the structure of your home

If your home is destroyed in a covered event such as a hurricane, lightning, vandalism, etc., homeowners insurance comes to the rescue. The insurance company will pay you the cost of repairing or rebuilding your home.


If your pergola, garage, shed, and other freestanding structures in your home get damaged, you may be compensated, depending on whether they are included in your policy.


Damage to the content of your home

Homeowners insurance also helps pay the cost of replacing personal items such as clothing, appliances, jewelry, furniture, and other contents damaged in a covered event. It also covers the theft of items.


An off-premises coverage lets you get some of the cost of replacing your stolen item, even if the incident didn't occur on your property.


Personal Liability

This coverage helps pay medical and legal bills if someone gets injured on your property and you're found liable. If your neighbor slips, falls, and injures herself on your property, you don't have to pay the cost; your insurer will step in.


If a tree on your property falls and damages your neighbor's roof, you're covered. If your dog bites your neighbor and successfully sues you, your insurer will help pay the medical and legal fees.


Additional living expenses

Due to extreme damage caused by a covered event, you may be unable to live in your home for a while.


Homeowners insurance covers the cost of renting a hotel room or other temporary accommodation, meals, and other additional expenses you might incur. However, there's often a daily limit you cannot exceed.


What isn't covered by homeowners insurance?

Most homeowners insurance doesn't cover floods, hurricanes, tornadoes, earthquakes, and other natural disasters. Events classified as "acts of God" or "acts of war" are excluded from homeowners policy.


Most homeowners insurance also won't automatically cover sewage and water backup, electric lines, and additional structures on your property. You can, however, purchase an extra policy to cover these events.



Factors that affect the cost of homeowners insurance

  • Square footage of your main building and additional structures.

  • The crime rate in your locality.

  • The materials and features of your home.

  • The chances of a covered disaster happening.

  • Distance between your home and the fire station.

  • Presence of volunteer firefighters.

  • Your claims history.


As an independent agency, our concern is getting you a homeowners insurance policy that protects all of your valued possessions. Contact us today.

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