In case of an emergency or an incident, maintaining continuous coverage of your property seems like the best way to protect your home and everything in and around it.
Your home is your most precious possession, and it would be most advisable to get comprehensive home insurance to make sure you’re covered at all times.
With that in mind, here at Market Pro Secure, we felt obliged to give you all the details regarding home insurance, what it covers, and how it benefits you.
What Is Home Insurance?
Home insurance is a policy that includes a range of selected packages of insurance coverage. That means that your home insurance policy covers your property from all damage.
It also provides coverage for legal responsibility and liability for any property damage and injuries sustained by other people that were caused by policyholders or their families.
This coverage also includes any damage caused by pets. In case of any natural disasters or environmental perils that could cause damage to your property, your home insurance policy has you covered.
But, there are some exceptions – poor maintenance, earthquakes, or flooding aren’t covered by standard home insurance policies.
However, it’s possible to protect your property from the aforementioned natural disasters by purchasing an additional, separate policy. As for the maintenance-related problems, those are the homeowners’ responsibility.
4 Types of Home Insurance Coverage
There are four essential types of insurance coverage that a standard home insurance policy includes.
1. Coverage for home structure
If your home gets destroyed or damaged by lightning, hail, hurricane, fire, or any natural disaster stated in the policy, your home insurance pays to rebuild or repair your home.
However, this coverage doesn’t include any payment for damages caused by routine wear and tear, earthquake, or a flood.
If you have any additional structures on your property, such as a gazebo, a tool shed, or a garage, these structures are also included in your home insurance policy.
2. Personal belongings coverage
All personal items such as sports equipment, clothes, furniture, jewelry, and everything else that you own; this is all covered by your home insurance policy, in case they are destroyed by insured disasters or stolen. The standard coverage provides for 50% to 70% of the amount on the home structure, and it also includes coverage for off-premises.
Off-premises coverage protects your belongings anywhere in the world unless you’ve stated otherwise. While personal belongings coverage covers for expensive items like silverware, furs, and jewelry, there is a dollar limit in case of theft.
If you want to ensure these items in full, you can purchase a special personal belongings floater that allows you to ensure your items to their full value.
Standard home insurance also covers scrubs, plants, and trees, and the general coverage goes up to $500. Perils included in the policy are falling aircraft, riot, vandalism, explosion, lightning, fire, and theft, while disease and wind damage aren’t included.
3. Liability protection
In case of any property damage or bodily injury caused to other people by policyholders, their families, and household pets, liability protection covers against any possible lawsuits.
The liability coverage pays for the court awards and the cost of defending the holder of the insurance policy in court. It’s important to mention that the amount of coverage goes up to the policy limit.
The liability coverage extends beyond the home and provides protection anywhere in the world. The liability limit is usually around $100,000, although it can be higher in case you choose to go with excess liability protection. This includes higher liability limits as well as claims for slander and libel.
4. Additional living expenses coverage
In case your home becomes inhabitable due to damage from any insured disaster like a storm or a fire, and you’re forced to live away from your property, the additional living expenses are covered by your home insurance policy.
It includes all additional costs like restaurant meals, hotel bills, and all other living expenses that you had during the rebuilding phase of your home. The amount of additional living expenses coverage differs. Not every insurance company offers the same coverage.
Types of Homeowners Insurance Policies
While there’s a fair standard for different types of homeowners insurance policies, individual companies and countries offer insurance policies that differ in details. These policies are considered deluxe or standard, depending on what additional coverage they provide.
Every homeowner has a number of different insurance solutions to choose from. The most popular home insurance policy that most homeowners prefer is the HO-3. It combines three types of insurance coverage:
- Personal liability
- Personal belongings
- Home structure coverage
What matters most is that HO-3 also includes protection from different perils or disasters. This protection provides coverage from:
- Civil commotion
- Aircraft damage
- Vehicle damage
- Malicious mischief
- Volcanic eruption
- Falling object
- Weight of sleet, snow or ice
The following damages are also included:
- Accidental overflow or discharge of steam or water from within an automatic fire-protection sprinkler system, air conditioning, heating, or plumbing, or any other household appliance.
- Accidental or sudden bulging, burning, cracking, or tearing of the automatic fire protection, air conditioning, or hot water or steam heating system.
- Freezing of a household appliance, fire protection, air conditioning, heating, or plumbing system.
- Accidental or sudden damage from a man-made electrical current.
HO-3 home insurance is usually purchased by homeowners who rent their living premises to renters. They use this insurance policy to cover the risks that might arise from renting. Aside from HO-3, there’s HO-8 that covers older homes, HO-2, that comes with limited coverage and is more aimed toward mobile homes, as well as HO-1, which isn’t widely available.
Best Home Insurance Companies
- Allstate – perfect for new homebuyers
- Amica – most excellent customer service
- State Farm – personalized online quote
- Nationwide – replacement coverage you can count on
- The Hartford – for green homes
- Liberty Mutual – full-time inflation protection. Related: Liberty Mutual Home Insurance Review
- Progressive – protect your boat
- USAA – best for war veterans, military members, and their families