What you are covered for
All home insurance policies generally cover two main areas, Property and Liability.
Property insurance includes your house and any detached structure located on your premises such as a shed or garage. Your family's personal items are covered whether damaged in your home, car, or temporarily away from your residence.
Valuables such as art, jewelry and paintings may require additional coverage.
Liability insurance is the second major component of your homeowner's policy. If deemed responsible, this section will cover negligent acts you commit, anywhere in the world, which cause harm to others.
What you are protected against
Home insurance policies can vary slightly, but usually cover damage to the structure of your home and your personal contents caused by:
- Fire, lightning or smoke
- Riot or civil commotion
- Impact by aircraft or land vehicles'
- Theft or vandalism
- Falling objects
- Freezing of pipes
Dwelling Building: Covers your house, attached structures and permanent fixtures in the home, such as a dishwasher or air conditioner. The dollar amount of coverage listed should equal the cost to rebuild your home if a disaster occurred.
Detached Structures: Will insure any structure that is not permanently attached to your main residence. Coverage extends to your fence, driveway, trees and shrubs.
Personal Property: This section provides insurance for all the personal property you and your family owns. Coverage for your personal contents expands to anywhere in the world.
Additional Living Expenses: Should your home be unlivable due to an unforeseen event such as a fire, this section covers living expenses if you can not live in your home while repairs are undertaken.
What Insurance options you have
Home insurance policies usually come in three forms.
The basic homeowner's package is ideal for individuals looking to save a little bit of cash. This package provides coverage for your house, contents and liability. Basic home insurance provides coverage on a named perils basis.
If basic coverage seems too minimal, you can upgrade to the Broad homeowners package. This policy provides all risk insurance coverage to your home and named perils coverage for your contents and is priced in the mid-level range.
The most inclusive home insurance package is a Comprehensive homeowner's policy. This policy provides all risk insurance coverage to your home and contents. Review the policy wording as there are certain situations or exclusions under all risk insurance.
Obtaining enough insurance coverage for your home is the only way to protect your most valuable asset. Your local broker is the best source for all your home insurance needs and questions. Make sure you understand what you are buying, who or what is covered, exclusions and policy limitations and how much coverage is provided and how to report a loss or claim. Remember to not confuse the value of your house with rebuilding costs. Insurance does not cover market value or the land.