If you are in the process of buying a house but have no idea how to get homeowner\u2019s insurance, you are at the right place! Like most types of insurance, homeowner\u2019s insurance reduces the costs associated with a risk, in return for a monthly premium, which is based on a lot of things, from your home\u2019s age to its location and more. The associated risk in the case of homeowner\u2019s insurance is the risk of a home being damaged or someone getting injured on the property. Homeowner\u2019s insurance operates through six coverages bundled together.<\/p>\n\n\n\n
The first coverage is \u201cdwelling coverage\u201d which protects the structure of the home from theft and pretty much every disaster you can think of, except floods and earthquakes, whose plans need to be purchased separately. In general, dwelling coverage works through a deductible and limit. A deductible is simply the amount of money you must pay per incident before your insurer pays the rest, while a limit is the maximum amount an insurer will pay.<\/p>\n\n\n\n
The next three coverages also work through a limit, typically as a percentage of the dwelling coverage. First is \u201cother structures on your property\u201d coverage, which covers things like outhouses and detached garages. The second is \u201cpersonal property\u201d coverage, which covers the cost of replacing the contents of your home. The third is the \u201closs of use\u201d coverage, which covers any expenses you incur while your home is uninhabitable, such as staying in a hotel.<\/p>\n\n\n\n
The last two coverages operate a bit differently. Their limits are standalone, independent of the dwelling coverage. First is \u201cpersonal liability coverage\u201d, which protects you against lawsuits filed by those injured on your property. The second is \u201cmedical payments coverage\u201d, which covers the medical expenses of those injured on your property who don\u2019t sue you.
We hope you now have a better understanding of coverage under homeowners\u2019 insurance!<\/p>\n\n\n\n