Homeowners Insurance 101

Homeowners Insurance 101

Homeowners insurance can be confusing, but it doesn’t have to be. Before you start shopping for coverage, it is important to know the different types of coverages available. Your policy will contain a lot of terms you may not recognize, but understanding the basics will help you understand your policy.

A lot of people know that they need Homeowners Insurance, but they don’t know what exactly they are getting and what it means. There are a lot of different coverage parts and it can be confusing. In this blog, we will look at the different parts of Homeowners coverage and what it means for you.

Sample Homeowners Policy
  • Coverage A or Dwelling Coverage
  • Coverage B or Other Structures
  • Coverage C or Personal Property
  • Coverage D or Loss of Use or ALE
  • Coverage E, F or Liability and Medical Payments

1. What is Dwelling coverage?

Dwelling coverage is one of the most important parts of a home insurance policy because it protects your home against damage or loss. The dwelling coverage part of your home insurance policy will pay to rebuild or repair your home if it is damaged or destroyed by an insured loss.

2. What is other Structures coverage?

Other Structures coverage is part of a Homeowners policy and is often confused with Dwelling coverage. Other Structures coverage is not the same as Dwelling coverage, which covers the home itself. Other Structures coverage provides protection for any outbuildings that are not attached to the home, but are still on the property. For example any fences, pole barns, detached garages, or sheds.

3. What is Personal Property?

Personal property is anything that is not part of the structure of your home. These valuables include furniture, clothing, collectibles, computers, and pretty much anything else that is not permanently attached to your home. If your items are damaged or lost, your homeowners insurance can help replace them.

4. What is Loss of Use or Alternative Living Expenses?

Home insurance policies cover the cost of living expenses if you are unable to live in your home due to an insured loss. So if you need to live in a hotel while your home is repaired your homeowners policy covers the costs of temporary housing expenses, including hotel bills, food, and other living expenses.

5. What is Personal Liability and Medical Payments?

Personal liability is a major component of a homeowners insurance policy, However, Most people do not know exactly what it means. Personal liability is a part of a policy that protects the policyholder if he/she is found at fault for an accident. Personal liability is a part of a policy that typically covers any bodily injuries and/or property damage that occurs from an accident that you cause. It also covers your legal defense if someone sues you. The insurance company will protect the policyholder from any claims made against them by another party. This is extremely important especially if you have a pool in your backyard or if you have a dog that is likely to bite, or even you host many parties.

Medical payments coverage is the same, but it covers anyone injured on your property, regardless of who was at fault up to the limits indicated on the policy.

Conclusion

Homeowners Insurance is a big topic, but as long as you understand the basics, you’ll be able to make insurance work for you. If you want to learn more about the different coverage parts of a Homeowners policy and what it means for you, reach out to the Insurit Agency to make sure your have the right coverages in place. We’re always here for you.

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