What Does Homeowners Insurance Cover?

One important insurance policy that every property holder should have is homeowners insurance. Although required by most banks for holding a mortgage, this type of insurance is a good idea for anyone who has property, as it protects the owner from losing money due to damage to the asset.

Standard homeowners policies cover damage caused by disasters such as falling trees, burst pipes, and other types of unforeseen events. Wind is often covered as well, unless the home is in an area that routinely gets a lot of wind such as some coastal areas. In this case, a wind restricted homeowners policy will be written, and the property owner will have to purchase separate wind insurance.

Other types of natural disasters such as floods may not be covered as well. Usually, if the home is in a flood plain, the homeowner will have to purchase flood insurance as a separate policy as well. Likewise, damage caused by the lack of maintaining the home is not covered either. For example, if the property owner does not protect wood siding by routinely painting it, a homeowners policy will not pay to replace any siding that is ruined because of this.

Structures that are not attached to the home, such as sheds or garages, are usually covered under a homeowners policy. In most cases, the coverage on these outbuildings is around ten percent of the amount of coverage on the main house.

In addition, most homeowners policies cover the policy holder’s personal belongings that are inside the home. So in the event of a disaster, not only will the policy pay to replace the house, but the owner will receive money to replace his/her things as well. Typically, personal items are covered at a rate of between fifty and seventy percent of the coverage on the house. In addition, most policies will cover personal belongings that are not in the home as well, which is known as off-premises coverage. For example, if an item is stolen from the policy holder while he/she is on vacation, the insurance policy will pay to replace the item.

Standard homeowners insurance policies will also include the value of the landscaping around the house. Items such as trees and shrubs are covered for things such as lightning and fire, but not for wind or blight. In most cases, these things can have coverage of up to five percent of the coverage on the home.

One big item that many people don’t think about in terms of homeowners insurance is liability protection. If the policy holder is sued because of injury to another person or damage to another person’s property, homeowner’s insurance will cover this event. Liability coverage usually starts at $100,000, and can go up to several million dollars.

No fault medical coverage is another item included in most homeowners policies, and this type of coverage will pay the medical expenses if someone is injured while in the home or on the property, without the homeowner actually being found liable for the injury.

Homeowners insurance not only covers the cost of rebuilding the home in case of disaster, but it can cover a lot more than many people realize. From protecting the homeowner from liability lawsuits, to replacing trees and shrubs that are damaged, this type of policy is one of the most practical types of insurance in existence today. When considering the relatively low premiums when compared with the true cost of an actual disaster, homeowners insurance in most cases is an excellent deal for any property owner.


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