Homeowners Insurance 101

For most people, their home is their most important (and expensive) asset. You want to protect it at all costs. This need is where homeowners insurance comes into play. Your policy will typically cover a variety of things: 

Your house: By this we mean the actual structure of your home. In the event that your home is damaged from a covered loss, your insurance will help pay to repair or rebuild it. 

Your stuff: Your policy can also help pay to replace your possessions. From your grandmother’s china to your mattress, you are covered. 

A place to stay: If you’re displaced from your home due to damages to it, your policy may include additional living expenses (ALE) coverage to pay for the cost of a hotel while your home is being fixed. 

Legal bills: Picture this- your neighbor trips over your porch steps and breaks her arm. Your homeowners insurance will help cover the cost of her medical bills and any other legal costs that may result. 

Covered Perils

To put it simply, a peril is any sort of event or instance that can cause serious damage. Here’s a list of the most commonly covered perils: 

• Windstorms 
• Fire and smoke 
• Lightning 
• Hail
• Tornadoes
• Theft and vandalism
• Vehicle crashing into your home
• Falling trees or other objects
• Heavy snow, sleet, or ice
• Water damage (from leaking roofs, broken pipes, water heaters, washing machines, dishwashers, etc., but not floods)

What is a deductible? 

You’ve heard this word before. A deductible is the amount you pay out-of-pocket before insurance covers any losses or damages to your home. So, if your deductible is $500, and a tree falls on your roof causing $3,500 worth of damage, you’ll pay the $500, and your insurance will pay the remaining $3,000.

Keep in mind the higher the deductible, the more of the repair cost you’ll have to take on. A higher deductible could mean that you’ll be paying a lower overall monthly rate.