Homeowners insurance cannot be left to chance. If you haven’t discussed coverage on your homeowner’s coverage in two years or more, you could very well be leaving yourself inadequately insured for loss. The longer it has been since you reviewed your home policy the more likely you don’t have the protection needed to secure against dramatic financial loss.
You might think homeowner’s policies are as complicated as the instructions that come with self-assembly furniture. It really isn’t, and we’ll break it down for you in manageable bite-sized pieces. This is the kind of service you can expect from Alliance Insurance Group. We want you to fully understand your options and the impact of your choices to make the most informed decisions.
There are two main parts of a homeowner’s insurance policy: Property protection and liability protection.
Property Protection covers four main areas:
- Part A—Dwelling
- Part B—Other Structures
- Part C—Personal Property
- Part D—Loss of Use
“Dwelling” is the main house structure and anything that is permanently attached such as lighting, plumbing, and electrical fixtures, built-in appliances, heating and cooling systems, shutters, awnings, porches and decks.
“Other Structures” would include a separate garage, shed, workshop, fence, generally structures that are built on the land. Any buildings that are used for business purposes are not covered under personal home insurance.
“Personal Property” would include all the contents of the home that you or your family owns and can also be covered up to a certain amount and time away from home. For example, if you go on vacation for a couple weeks, all your personal belongings that are with you are 100% covered. If you have a college student who is living in a dorm, their personal belongings would be covered up to a certain percentage of your coverage limit.
There are some limits to personal property depending on the type of home policy you purchase and depending on endorsement choices.
- Cameras and equipment
- Tools for personal use
- Fine art
- Musical instruments
- Computers and software
- Sporting equipment such as golf clubs
If you wish to discuss coverage options for any or all of these items, please contact us and we can help properly insure all your important and high-value personal belongings.
“Loss of Use” refers to the costs of living expenses incurred when you are denied access to your home while it is being repaired or rebuilt from a covered loss. If you have a fire and you have to live in a hotel for a few months while repairs are made, your insurance policy will cover any additional living expenses: Hotel rates, laundry services, extra transportation expenses, and additional food expense are a few examples.
Liability Protection covers two main areas:
- Part E—Personal Liability
- Part F—Medical Payment
“Personal Liability” will protect you if you are found liable or legally responsible for injury, death, or damage to other’s property. For example, a neighbor’s child drowned in your pool while unsupervised and they sued you for negligence and win a wrongful death lawsuit. Your policy will cover this loss up to the limit you choose. So choose wisely! The more exposure you have to possible liable loss (pool, pets, trampoline, playground equipment), the more protection you want to secure. Additional liability protection can be purchased with an “umbrella” liability that will provide added protection above all your liability coverages under home, auto, boat, motorcycle, etc.
“Medical Payments” is a third party coverage that will pay for any medical bills arising from injury on your property. It does not cover you or household members, but it will cover guests. If your guest trips over the rake you left laying in the yard, falls down and breaks their arm, you can cover all their expenses for the ER, x-rays, doctor bills, orthopedic specialists, etc. Insurance companies hope that by covering these expenses your guest will not turn around and sue you for negligence.
Please note: Homeowner policies do not cover floodwater damage. Flood is a widespread disaster that affects a large area and would cause an insurance company to quickly go out of business. For this reason, the US government has taken the responsibility to pay for flood loss and just leaves the administrative and processing to the insurance companies.
Avoid the mistake of believing you can’t have a flood because your home is not a designated “flood zone”. The National Flood Insurance Plan website sites that “nearly 20% of flood insurance claims come from moderate- to low-risk areas.”
The possibility of flood exists in any place that it rains. You may have a large rainfall that occurs over a short period of time that overfills rivers, streams, and drainage systems.
The great news for homes that are not in a flood hazard zone is that flood insurance is comparably inexpensive. Flood insurance is an essential protection for your home.