Homeowners Coverage Basics



Types of common coverage:

  • Property

  • Contents Replacement
  • Liability
  • Medical Payments
  • Additional Living Expenses


             Homeowner's insurance is a common expense associated with the ownership of one's own home. Not all homeowners know what this insurance covers. Even more importantly, homeowners do not know the limitations of the policies and find themselves without the coverage they thought they had when they need it most. Knowing the purpose of homeowners insurance and what it does or doesn't cover can help you make important decisions about protecting your property and cutting unnecessary expenses. Many of  the important terms and concepts will be explained in the next section. Having this insurance will help protect one of your most valuable possessions, for that reason getting a premium policy ensures a safety net for your investment.

Terms and Concepts

*Property- Homeowners insurance covers many types of damage to your home and separate structures, like a detached garage. Your policy will cover damage caused by things like wind, fire, and vandalism (subject to exclusions).

*Contents Replacements- Your personal property is covered anywhere in the world. Coverage is comprehensive, applying to many types of damage and many causes of loss or damage (subject to exclusions). Contents Replacement Cost is included and, subject to loss settlement, pays for the cost of repair or replacement without deduction for depreciation.

*Liability-Pays when you're legally liable for someone else's bodily injury or property damage resulting from an accident, negligent acts by you or household members (on or off premises). This also includes the acts of your pets.

*Medical Payments- Pays medical costs for people injured at your residence (other than residents of your household), regardless of liability.

*Additional Living Expenses- Covers additional living expenses up to 24 months (depending on the policy type) if a covered loss makes your home unfit to live in.