What Does Home Insurance Cover?
Homeowners insurance covers the loss, damage, and liability that can be caused by many perils. In the insurance world, these perils include theft, windstorms, and fire. You can also get medical bills paid, as well as lost wages and expenses, if your home is sued by someone for injuries.
What Does House Insurance Cover?
A homeowners' policy will typically include a number of different coverages to protect your home, personal property and other structures. It should also include liability insurance that pays for any court costs if you are sued for damage to someone else's property or injury to another person on your property.
Homeowners policies with HO-3 coverage are available for open-peril risks.
Homeowner's insurance comes in two forms: the comprehensive form (HO-05), and the modified version (HO-8). The former provides protection against damage from any peril, whereas the latter only covers named perils. Both options provide protection from fire, theft and other dangers. But the latter option can be more cost-effective and prevent large losses for expensive items like furs or jewellery.
HO-3 Policies are commonly offered by leading home insurers.
These can be bought on either a basis of replacement cost, or actual cash value. Your insurance company will pay for the materials to be used in a rebuilding your home at replacement cost if it is done from scratch. This can get expensive if you want to add new rooms or even insulation. An actual cash-value policy is only worth as much as your home is currently worth, less any depreciation.
Liability Coverage
A standard homeowners policy will cover damage that occurs on your premises. This is important, especially if there are children playing on your lawn and a pet bites you. This coverage is often accompanied by an individual liability limit, which protects you against claims arising from injuries or property damage that occurs on your premises.
Insurance Coverage for Loss in Use
If you have to stay in a hotel or pay other temporary expenses while your house is being rebuilt, a loss of use claim can help. The amount of coverage will vary by policy but typically ranges between 20% to 50% of your total policy.
Personal Property Insurance
Most homeowners policies will replace your furniture, electronics and other personal possessions, if damaged in a covered loss. Some homeowners insurance policies include special coverage for items of high value, like jewelry or art.
Liability Insurance
Liability coverage is a part of your homeowners insurance that protects you from lawsuits resulting from injuries or property damage on your premises. This part of your policy pays for medical bills, lost income and other expenses as a consequence of injuries or damage caused to someone on your property.
ALE Endorsement
This endorsement will pay for the restoration or repair of your home in order to meet new building codes and ordinances which were in effect when it was built. The cost for this endorsement can be a small additional premium, but it is well worth the peace of mind.