Home Insurance FAQs

A home is more than just the structure in which you live. It is also where you keep your possessions, it is where you relax after a long day and it is also where you keep warm on a cold evening. It houses your family and all of their memories. That’s why it is important to protect your home with adequate insurance to cover the unexpected events that inevitably occurs.

What is covered in a standard home insurance policy?

A standard policy covers four main things: the structure of your home, your personal belongings, property and injury liability and some additional living expenses in the event of a catastrophe.

Structure of Your Home

You should buy enough homeowner's insurance to cover the cost of rebuilding your home if the event it is damaged or destroyed. Most standard policies will also cover structures that are not attached to your home such as a garage or a shed.

Liability

Liability coverage protects against bodily injury and property lawsuits. It pays for your defense in court and any money you are required to pay in the event of a judgement against you, the maximum amount that is paid is determined by your policy limit. This includes no-fault medical coverage for someone that may be injured in your home or on your property.

Personal Belongings

Most policies offer coverage for your personal belongings and will pay between 50 to 70 for the replacememt of damaged or stolen personal property. It is essential to conduct a home inventory before you purchase home insurance, this will give you an idea of the amount of coverage that is needed for coverage. Many policies will cover your possessions anywhere in the world. Make sure you ask your home insurance agent about away from home coverages.

Additional Expenses

If your home is damaged so badly that you must leave while it is repaired, a standard home insurance policy will pay for your hotel stay, dining costs and will even reimburse you for any money that was lost if you rent out part of your home.

Is my home covered in the event of an earthquake or a flood?

You will need to purchase flood insurance and earthquake insurance separately. Most home insurance companies do offer this type of coverage, but it not part of a standard home insurance policy. These types of insurance differ from other types of didsaster coverages. For example, earthquake insurance covers a percentage of the damages instead of a dollar amount. Talk to your insurer or your agent to get find out the specifics.

What is the difference between 'actual cash value' and 'replacement cost'?

'Actual cash value' coverage pays to rebuild your home, minus depreciation. And a 'replacement cost' policy pays to replace your home and/or possessions without any deductions.

Am I required to purchase a home insurance plan?

You are not legally required to purchase home insurance. However, if you finance your home through a mortgage company, they may require you to have some kind of home insurance policy. Even if your home is paid in full, it is a wise decision to have home insurance coverage in order to protect your major investment; the place in which you live and love.