What does homeowners insurance usually cover?

You wouldn’t buy a car without paying to insure it, so why would you make an even bigger financial investment — a house — without securing any protection on it?

Homeowner’s insurance can help you protect your biggest asset from natural disasters, theft and other unexpected circumstances. Here are some of the primary inclusions in standard homeowners insurance policies.

Your home’s structure

One essential aspect of homeowner’s insurance includes coverage for the structure of your house. This means that your home is typically protected from perils including:

• Fire
• Tornado
• Hail and storm damage (but not from floods or earthquakes)
• Burglary and theft

Structural coverage means that your insurance company will either pay for the property to be repaired or rebuilt depending on the damage that has occurred.

There are a few exceptions to structural coverage. First, flooding and earthquake damage is not covered by most standard homeowners insurance policies, but you can buy additional insurance policies for these perils through most insurance companies.

Next, if you own additional structures on your property grounds — like a guest house, a detached garage, a large pole barn or a constructed storage shed — you may need to inquire about extra coverage.

Personal belongings

Even a minimal home insurance policy often provides protection for your personal belongings, including furniture, clothing, electronics, sports equipment and other items.

It’s important to view your personal belongings in terms of their replacement value, as opposed to their depreciated value. The insurance company will buy brand new items for you if you have a claim. For example, if your television was damaged, you would get a brand new TV (replacement cost), not a used one from a garage sale (depreciated cost.)

Most insurance providers offer coverage for 50 to 70 percent of the value of the personal property you have on the structure of the property.

To guarantee you have an adequate plan for your items, create a home inventory and keep receipts documenting the cost of items upon purchase. If you have expensive belongings — including heirlooms, jewelry or art — you may want to purchase additional coverage in the form of a personal articles policy.

Liability protection

Liability coverage pays for court fees as well as bodily injury or property damage that the insured causes to others.

Liability protection includes accidents or incidents that occur on your own property; common liability claims include injuries that guests sustain from dog bites, slippery stairs or unkempt walkways.

This coverage also covers some incidents that occur outside your home, provided the damage is caused by an insured party. For example, if your dog sneaks into your neighbor’s yard and tears up her prized rose garden, you may be able to file a liability insurance claim. Similarly, if your insured child breaks a window playing baseball in the backyard, you may also be covered for that. (And if it’s the same neighbor with the rose garden, you may want to consider a conciliatory gift to smooth things over.)

Liability protection is included in most basic home insurance plans, though you may need additional coverage if you have pets or risky features such as a swimming pool or trampoline.

Additional living expenses

In some cases, homeowners have to leave their home while it is being repaired or rebuilt after an insured disaster. In this case, your homeowner’s insurance may offer additional living expenses (ALE) that cover the cost of living away during this time.

ALE can cover hotel bills or other temporary housing, as well as restaurant meals or food costs, over and above your usual expenses, while your property is being repaired or rebuilt.

Most policies have a financial or time limit on ALE, but these limitations are separate from the limit of your structural coverage. (This means that you’ll never have to choose between repairing a certain part of your home and your grocery store run — these expenses come from completely different coverage accounts.

Need to secure homeowner’s insurance?

If you're considering purchasing homeowner’s insurance, or have other questions about how to best protect your home from hazard and theft, reach out to an Edina Realty Insurance expert today.