What Does Homeowners Insurance Cover
A standard homeowners policy comes packed with a variety of different coverage. Here are the basic outline of coverage you will find included on a typical homeowners policy.
Coverage (A): Dwelling
Coverage (A) protects the home itself and anything attached to the home. Generally, your homeowners insurance policy will pay up to the policy limit in the event of damages caused by fire and storms. Tornadoes, hurricanes and other natural disasters may be covered depending on the company and policy. In some areas you may need a separate policy for additional coverage from natural disaster.
Coverage (B): Other Structures
Coverage (B) provides protection for other structures around the property. These structures must not be attached, such as an unattached garage, shed, storage room, etc. Coverage limit is based on a percentage of the coverage A limits.
Coverage (C): Unscheduled Personal Property
This part of your homeowners policy covers damage to your personal items you own. Most home policies limit coverage for personal property up to 75% of the coverage A limit. So if your policy provides $100,000 in coverage for the dwelling, you can have up to $75,000 in personal property coverage. Certain policies may only cover the depreciated value of these items so keep this in mind. Some policies will provide replacement cost coverage.
Coverage (D): Loss of Use
Coverage (D) makes for a great addition to any home policy. This coverage reimburses you for the additional expense you incur while your home remains uninhabitable due to a covered loss. While your home is being worked on, you may need to stay at a hotel which can be costly over the course of a week or two.
Coverage (E): Personal Liability
This is also a great benefit to having a home policy. Personal liability provides coverage in the event that another person brings forth a lawsuit against you. This may be from bodily injury caused or property damage that is the result from the homeowners negligence. Dog bites are one of the most common claims filed against homeowners. The insurance information institute estimates that one-third of all liability claims are brought on due to dog bites.
Coverage (F): Medical Payments
Medical payments will provide coverage for injury if a third party is injured by your personal property or while on your property. $5,000 is a common base limit used for medical payments coverage. This limit can be increased by the insured.
Certain items such as coins, firearms artwork and jewelry will have a specific limit of coverage based on the policy you select. Most companies provide up to $200 coverage for money (coins). If you have a rare collection it would be wise to add a rider to your policy. The rider is also known as Scheduled Personal Property which provides additional coverage for specific personal possessions.