What Every Homeowners Insurance Policy Should Offer

2006-09-29

A homeowner’s insurance policy is your total safeguard for your home, personal property and personal liability against natural disasters like fire, hurricane, hail, or any insured disaster. It also provides you money if you need to vacate your home after these disasters to have it rebuilt.

A homeowner’s insurance policy includes four types of coverage which are: coverage for the structure of your home, coverage for your personal belongings, liability protection, and additional living expenses while you have your home rebuild after a calamity or any disaster stated in the policy.

The structure of your house and other structures on your property
This part of the homeowners policy insures the structure of your home and other structures on your property such as barns, sheds and unattached garages damaged or destroyed by fire, lighting, explosions, theft, vandalism, hurricane, hail or other perils such malicious mischief, damage from vehicles, accidental damage from smoke, objects falling from the sky, accidental discharge or overflow of water from your plumbing, freezing of plumbing, etc. As long as it is stated in your policy, the insurance will repair and rebuild your home from any kind of disaster. However, standard homeowners’ insurance policies do not cover earthquakes, floods or routine wear and tear. If you need to insure your home against these risks, you must get a separate earthquake or flood insurance policy.

Personal Property
A homeowner’s insurance policy also protects your personal belongings inside your home such as furniture, clothes, sports equipment, etc. if they are damaged or destroyed by the same list of risks and perils as your home’s structure. The best way to determine if your coverage is enough is to conduct a home inventory. Unless otherwise specified, personal property coverage is for actual cash value at the time of loss, which is the original cost of the item, minus depreciation.

Bear in mind that your policy should include off-premises coverage. This simply means that your belongings are covered even they are outside your home, may they be anywhere in the world.

Expensive items like jewelry, furs and silverware are likewise covered. However, if you need to insure these items to their full value, purchase a special personal property endorsement or floater and insure these items for their appraised value. This coverage also includes “accidental disappearance,” which means these are insured even you simply lose them.

Trees, plants and shrubs are also covered if they damaged by fire, lighting, explosion or theft as long it is stipulated in your policy. However, some policy may not cover for damages caused by wind or disease.

Personal Liability
Since lawsuits can really be financially burdensome, this particular coverage protects you against lawsuits for any injury or harm or any property damaged that you and your family and even your pets have caused to other people. This coverage offers to pay for all expenses that may be incurred in courts and any court awards. No need to worry even if you and your family members are not home and are miles away because you are covered wherever you may be. This particular policy should also provide you a no-fault medical coverage. This means that the people you may have injured just simply submit their medical bills to the insurance company and everything will be taken cared of.

If you stipulated in your policy an umbrella or excess liability policy, then this is much better because this means that you have broader coverage and higher liability limits including claims against you for libel and even slander.

Additional living expenses
If for example, your home has to be renovated because of damages brought about by storm, fire or any other insured disaster, this coverage offers you guaranteed money for costs you may incur living away from your home. It provides you temporary housing expenses such as hotel bills, restaurant meals, car storage and even temporary shelter expenses for your pets.

And, if you are renting out part of your house, the policy should likewise cover the rent that you would have collected from your tenant while your home is being rebuilt.

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