A residence or home is often the most valuable asset owned by an individual or family. A homeowners policy is designed to cover this asset at replacement cost of the home from various perils as well as protect the named insured from liability claims resulting from negligence of the insured. Homeowners policies can vary significantly from a pricing and coverage standpoint depending on the insurance carrier, the property being insured, and the optional coverages that are selected.
A typical policy will have the following coverage options available:
This pays for repair or replacement cost to the house itself for partial and total losses, after a deductible is met. Anything that is permanently attached to the dwelling is considered part of the house. The limit of insurance is calculated by determining the cost to rebuild the house in the event of a total loss. It does not factor in things like market value or land. Part of the home may be insured on an “actual cash value” basis, such as the roof, depending on the age or condition. This means in the event of a claim the insurance company will pay the replacement cost less the estimated depreciation of the roof to determine the settlement, which can be significantly less than the replacement cost.
Personal Property Coverage
This pays for contents damaged inside of a home that are not permanently attached to the home. This includes things like clothing, appliances, equipment, kitchenware, furniture, and other items that can be moved in and out of the home. There is often a sublimit for things like money, jewelry, or unique items that have a specific value to it. The limit usually starts at 50-75% of the dwelling coverage but can be increased at request.
This pays for any detached structure away from the home on the same premises. This will typically be things like a detached garage or storage shed. The limit usually starts at 10% of the dwelling coverage but can be increased at request.
Loss of Use
This pays for extra expenses incurred by a family that needs to find a temporary place to stay after a loss to their home. While the home is being repaired or replaced, this coverage can help cover the additional living expenses while a home cannot be occupied.
This is a third party coverage that pays for lawsuits or injuries brought on by a third party against the homeowner. Examples of homeowner claims include dog bites, slip & falls on premises, failure to maintain a safe premise, and host liquor liability.
There are many coverage items that can be added to a policy that may not be automatically provided by the carrier unless endorsed. These include things like flood & earthquake coverage, water back up, equipment breakdown, service line coverage, scheduled jewelry, special personal property, personal property replacement cost, identity theft, and many others. It is important to do a full review with an experienced agent so you understand how your policy should respond in the event of an unforeseen claim.
Stolly Insurance Group is an independent agency that can offer comparative quotes with many different excellent rated insurance carriers that offer these products. Call our office to speak with an agent today.
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