Paying for homeowners insurance month after month may seem unnecessary, especially if you’ve never had to raise a claim. But, keep in mind that if a disaster strikes, you will need funds to rebuild your home and replace your possessions, and that’s why it is so important to have homeowners insurance. Let’s take a look at what exactly homeowners insurance covers:
- Dwelling Coverage: Homeowners insurance will cover damages to your home and any attached structures. Typically, you will receive enough funds to rebuild your home, provided you opted for adequate coverage.
- Other Structures: Homeowners insurance also covers your larger property. So, any structures that are detached from your home are also covered.
- Personal Belongings: If your personal belongings or assets were to be damaged or stolen as part of a covered loss, your policy will cover the repair or replacement costs.
- Living Expenses: If you are unable to continue staying in your home due to a covered loss, your policy will cover your living expenses until the home has been rebuilt or repaired.
- Liability Coverage: If you happen to injure someone or if your actions cause any extent of property damage, your policy will cover the resulting expenses.
- Third-Party Medical Expenses: If a third-party injures themselves on your property, your policy will cover their medical expenses, regardless of who was at fault.
What Does Homeowners Insurance Not Cover?
While homeowners insurance policies offer comprehensive coverage, there are certain losses that remain uncovered by standard policies. For instance, most homeowners insurance policies do not cover damages or losses caused due to earthquakes or flooding. If you need coverage against these natural disasters, you’ll need to buy a separate policy. Similarly, homeowners insurance also doesn’t cover damages caused due to government action. Before you buy your policy, it’s a good idea to read through the fine print so you are aware of the inclusions and exclusions.
The Bottom Line
Homeowners insurance is something you should have – regardless of whether you will ever have to use it or not. If you are worried about the cost, shopping around and comparing prices of policies will likely get you a better deal. Also, don’t forget to ask your insurance provider for discounts.
