Many first-time homebuyers often ask if they really need homeowners insurance and what does it cover? The answer is that homeowners insurance is not just coverage but a bundle of several coverages. These can apply simultaneously or individually in various circumstances.
You cannot play a pick and choose game when it comes to buying homeowners insurance. However, you can always purchase a coverage level suitable for each category depending on the value of your assets, type of home, and your budget,
This post will give you valuable insight into what your homeowners insurance will protect your home against.
What Homeowners Insurance Covers
Here are four major components that are a part of almost every homeowners insurance coverage.
1. Structural Damage and Loss of Property
A standard homeowners insurance policy will cover your home for any structural damages. Apart from that, this type of insurance coverage also protects the contents or assets on your property.
Whether you are a first-time buyer or an existing homeowner, it is essential that you take out an insurance policy. However, always ensure that it covers not only damage to the property but also any damage or loss of its content.
Additionally, it would be best in your interest if the homeowners insurance policy covers you against damages caused by theft, vandalism, fire, etc. You may have to purchase separate coverage for protection against floods, earthquakes, hurricanes, and other severe climatic conditions.
2. Liability for Injuries and Damage to Other’s Property
Homeowners insurance will cover you for personal liabilities as well as bodily injuries. In case a visitor is staying in the house and sustain an injury on your property, the homeowners insurance will cover their medical bills. In case the person decides to file a lawsuit, your homeowners insurance will cover you for that too.
Moreover, if you accidentally damage someone else’s property, the insurance policy will cover the expenses.
3. Offering Additional Living Expenses
Homeowners insurance may also cover additional living expenses under unforeseen circumstances. This refers to your homeowner insurance will cover your bills to stay in temporary accommodation.
For example, if you are unable to live in your own home due to severe structural damage. This also applies to scenarios where the government evacuates the area due to wildfires or flooding threats etc.
You must remember that this applies to situations of accidents or natural disasters. However, the insurance provider will pay you only what is a reasonable expense for temporary accommodation. Do not go around checking yourself in a five-star hotel or a massive villa.
Moreover, your policy’s terms and conditions will state how long it will cover your expenses and how much money per day you will receive in reimbursement.
4. Structural Repair and Maintenance Protection
As you live in a home, some parts of it may start to show signs of wear and tear. Homeowner insurance covers these structural damages, including the home’s foundation, roofs, and walls.
The dwelling protection component may also cover structures attached to your house. These include patio, deck, garage, sheds, etc.
Some home insurance policies also cover detached structures such as a fence, tool shed, and detached garage on your property.
Things to Remember
You must always remember that each component of your homeowners insurance policy has a limit. Therefore, always ask the insurance company to provide you the maximum amount to pay for the damage or losses.
With some insurance companies, you may be able to adjust your coverage’s upper limit as per your needs. For example, the value of your house and the assets are higher than the default limit by the insurance provider. You can bargain with them to increase the limit. However, this will cost you higher premiums and deductibles.
What is a Deductible?
Most homeowners insurance policies require you to pay a deductible when trying to make a claim. You will pay a pre-determined fee before the insurance policy’s benefits kick in to cover your losses. However, you can again adjust the deductible as per your needs.
Homeowners insurance offers protection to your household and its assets. This may serve as a safety net for you, especially in case of emergencies or other scenarios. Therefore, you must research online to find the best homeowners insurance coverage in your area.
You must remember that while it may cost you some amount on a monthly basis, you will most likely end up saving thousands in case things go south. Moreover, you must get an evaluation of your home and its assets. Make a list of all the components of your household you wish to include in homeowners insurance before calling the insurance company.
Are you unsure what you can and cannot include in your homeowners insurance and how much it will cost? In that case, feel free to contact Velox Insurance and speak to our experienced insurance agents.