Home Insurance Policy

A basic home owner insurance policy typically includes six kinds of coverage: dwelling, other structures on the property, contents/personal belongings, loss of use, liability protection, and medical payments. Each of these coverages is essential to protecting your possessions and the structure of your home as well as safeguarding yourself against liability from personal injury lawsuits. Read on for a detailed explanation of each of these protections.

Dwelling Considerations

Every homeowner policy will include dwelling coverage, which protects the actual structure of your home in the event of damage or loss resulting from a variety of perils. Usually, a standard plan will protect against disasters like fire, vandalism, hail, lightning, and windstorms. With most insurers, you will need to take out a separate plan or add a rider to your existing agreement to protect against floods and earthquakes. Should anything happen to your house's structure, this portion of your plan would pay to replace or repair your home.

Additional Structures

Home insurance policies will normally also look after detached structures on your property in addition to your actual home. Common structures include sheds, guesthouses, and garages. The average coverage for these structures is ten percent of the policy's dwelling coverage, but you can purchase additional protection if necessary.

Personal Possessions

The items you keep in your home need protection just as much as the home itself does. Every offering will include a certain amount of reimbursement for personal belongings, or the items you store within your home. Homeowners often underestimate the value of their furniture, clothing, electronics, appliances, and other such items, which is why it is important to take a home inventory before purchasing homeowners policies. The amount of personal property protection included in your agreement is up to you, so you can select the amount of coverage that matches the value of your belongings.

Loss of Use

In the event a loss leaves your home uninhabitable, the loss-of-use portion of your policy will pay for your living expenses while your home is repaired or rebuilt. This includes expenses like lodging and food for a limited period of time. You might use this coverage to pay hotel bills, rent, restaurant checks, and so on.

Personal Liability Protection

If someone suffers an injury on your property, the personal liability protection included in your agreement will settle any lawsuits against you or your family members. Personal liability typically also goes towards the damage family pets may do to other people, such as dog bites. The policyholder can choose the appropriate liability limits for his/her circumstances.

Medical Payments

Related to personal liability, medical payments will go towards the medical bills of someone who suffers an injury on your property and does not sue. Your plan will go towards the injured party's doctor or hospital bills. This is also referred to as "MedPay." Some carriers offer plans with varying amounts of MedPay protection, in which case you can use your discretion to set your limits.