Homeowners Insurance

Cover Your Residence for Rainy Days

Your home is your most expensive and valuable asset. Most foreseeable events may not be preventable, but the damages caused by them can be compensated through homeowners insurance.    

Home insurance is designed to protect your house and personal belongings from financial losses that occur from damages including theft and vandalism. Your policy also extends its protection to your garage, gazebo, and other structures on your property. While the usual homeowners policy will protect your home and other valued possessions from standard events such as riots, theft, or fire, you may also choose additional endorsements such as liability and medical payments.

In this article

Why do you need Homeowners Insurance?

Most would argue that a house is the most expensive thing a person will ever buy in their lifetime. A house protects you, your loved ones, and your possessions. If fire or theft damages your home, your quality of life and your finances suffer. Does it not seem smart to get your most expensive purchase insured?

For example, while you were out having dinner, a massive fire starts in your kitchen and makes it to your bedrooms. The fire has damaged everything, and now you will need to replace these items out of pocket.

However, with homeowners insurance coverage, you wouldn’t be paying for renovations and replacements; your insurance will take care of it for you. Additionally, it will cover a portion of your hotel bills while the insurance covers your home renovation. 

While you may think that your home doesn’t need home insurance, it may not be the case. If you have a mortgage, your loan providers will most certainly ask for evidence of insurance. If you are one of the lucky people who do not have any mortgage, it is just smart to protect your property.

What are the Homeowners Insurance coverages?


A standard homeowner’s insurance policy will cover expenses to rebuild your home if damaged by named perils such as fire, theft, robbery, etc.  But a standard policy will not cover for damages caused by earthquakes, floods, etc.

Suppose your windows shatter due to heavy rain and hailstorm, and you need to get them fixed. In this case, your standard policy will cover all of the expenses for repairing your windows.   

But suppose an earthquake damages your walls. In this case, since earthquakes was not one of the named perils on your policy, your insurance carrier will not compensate you for it and you will be paying for the repairs out of pocket.

Personal Property

Personal property will cover any injury or damage that you and your family members are legally held responsible for.   

Suppose a handyman visits your place to fix a broken TV and trips on your faulty stairs. They break their leg and damage their phone during the fall. Now, not only are they injured, but they have a damaged property and lost the ability to work as well. You will be held liable for their medical bills, lost income, and damaged phone.  

With homeowners property insurance, you will be able to pay off the handyman. This coverage will also pay for any legal fees should the handyman decide to sue you.  

Your policy also covers personal property such as jewelry, art, clothes, and other personal items.  Your personal belongings are covered even if they are stored in a place away from your dwelling.

how much does homeowners insurance cost

Other structures

Good news — if you are under the impression that a homeowners insurance policy only covers the house and nothing else, you’re going to be pleasantly surprised. Your standard policy will readily cover any detached property, such as a shed or fence. Any harm that comes to your detached property due to the perils covered by your policy will be compensated.

The standard coverage for your detached structures is typically 10% of the total amount of your home insurance. If you insure your home for $100,000, your other structures will be insured for $10,000.

Additional Living Expenses (ALE)

If you cannot live in your house because it needs to be repaired, with a standard homeowners insurance policy e the living expenses incurred while the damages are being repaired will be covered.  

For example, imagine a massive fire breaks out in your home and engulfs your living areas. You cannot live in your home because the fire has destroyed all of the rooms, and it needs to be rebuilt completely. You and your family now need to live away from home temporarily while it is being renovated. Your insurer will pay off your living expenses for the duration of the renovation of your dwelling.

Guest Medical Payments

Your standard homeowners policy protects even your guests! Your guests may experience an injury while visiting your home. Suppose they happen to touch a faulty wire, which results in them being electrocuted. Guest medical payments coverage will help you pay for the medical bills of your guest.

Homeowners insurance-infographics

A quote today will save your home from tomorrow’s rainy day!

What is not covered by Homeowners Insurance?

While home insurance is one of the broadest forms of insurance coverage, it is not all-encompassing. There are some occurrences that your homeowners insurance provider may not cover.

Here are some of the general exclusions in a homeowners insurance policy:

  1. Earth movement
  1. Ordinance of law
  1. Flood, tidal waves, tsunami, surface water
  1. Power failure
  1. Nuclear hazard
  1. Intentional damages
  1. Confiscation and destruction of property by a government authority
  1. Natural wear and tear, mold, and infestations

Who needs Homeowners Insurance?  

It may surprise you, but there are eight different types of homeowners insurance, each ranging from basic coverages to more comprehensive.

HO-1 Coverage

This is the most basic form of homeowners insurance coverage. It will cover your dwelling from damages due to fire, hailstorm, riots, theft, vandalism, smoke, falling objects, and aircraft. Homeowners may choose this form as it’s affordable home insurance. However, this option will not cover your expenses if you are held liable for third party injuries in your property.

HO-2 Coverage

This coverage is like an upgrade from the HO-1 coverage because it gives all the aforementioned coverages with a few additional named perils:   

  • Freezing
  • Sudden damages to built-in appliances
  • Weight of ice and snow
  • Volcanic activities
  • Sudden damages from the artificial electrical current generated by an appliance

HO-2 coverage is generally a broader form of homeowners insurance than the HO-1 policy.

HO-3 Coverage 

This is a special form of coverage, as it is the most commonly purchased among single-family home policy owners. It covers both the home, attached, and detached property. In short, all risks are covered in this policy. You are covered for property loss, liabilities, medical bills, natural perils, theft, vandalism, and robbery.

You may also ask your homeowners insurance broker to add a replacement-cost endorsement, which costs you an additional amount of money. Still, some companies add it as a base policy.

HO-4 Coverage 

More specifically known as renters insurance, HO-4 coverage is designed for people who choose to rent homes, condos, and apartments. The coverage is the same as HO-2 and HO-3 coverage policies. Since the renters don’t own the dwelling, this insurance instead covers for damages to their property.

what does homeowners insurance cover

HO-5 Coverage

HO-5 coverage may very well be the most all-inclusive and thorough form of homeowners insurance available to homeowners. All the perils covered by HO-3 coverage are covered in the HO-5 policy, but it also protects your personal belongings from events that are not expressly named in the policies.

Talk to your homeowners insurance agent about premiums and coverages before you make any decisions, though, as the premiums for HO-5 policies tend to mount higher than any other policy.

HO-6 Coverage 

You may recognize this policy as condo insurance, which is for people who reside in condominiums. It covers damages to the structure of the building, common areas, and the unit you live in. Your coverage protects you from damage to personal property, loss of use, medical payments due to bodily injury on the property, and loss assessment coverage — renovations and improvements made to the dwelling. Meanwhile, your stay in the condo is not covered.

HO-7 Coverage 

Owners of mobile or manufactured homes also need protection from perils, which is why HO-7 coverage was introduced. This coverage is essentially an HO-3 policy, but for mobile homes. Some of the mobile homes covered in this policy are:

  • Modular homes
  • Sectional homes
  • Park model homes
  • Trailers

HO-8 Coverage 

HO-8 homeowners insurance is a specific type of insurance policy for the homes that do not meet insurer standards. You may be living in a house that may be older and at a higher risk of loss due to outdated appliances and materials. Your dwelling may need a lot of upgrades and renovations to qualify for insurance coverage in the first place. Thus, HO-8 was introduced as remedial insurance coverage for such types of homes.

What is the cost of homeowners insurance?

There are a number of variables that determine the premium for your homeowners insurance. Some of these variables are

  1. Location of your home
  2. Size and age of your home
  3. Upgrades and appliances added to your home
  4. Your state laws and regulations
  5.  The type of homeowners coverage you need

According to Homeowners Insurance Report for 2016, the average premium for an H0-3 policy is $1,192 and HO-4 policy is $185.

Does homeowners insurance cover house foundation repair?

You will need to pinpoint the cause of your house’s foundation issues. If the issues stem from damages caused by named perils, the foundation repairment costs will be taken care of by the insurance policy.

A quote today will save your home from tomorrow’s rainy day!

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