If you are planning to buy a house or are already in the process of purchasing one, you have most certainly come across the term “homeowners insurance.”
Homeowners insurance is an essential component that protects not only your home but possessions against theft and any accidental damage that may occur. It provides the funds to repair damages that occur to you and or your property and helps you gain investment from mortgage lenders.
Although homeowners insurance is not required by law, it can protect you from several home/property-related troubles long term. It is always advised to purchase homeowners insurance for the following reasons:
- Homeowners insurance provides you with any financial assistance needed to repair or rebuild your home in any unexpected disaster such as a fire or a tornado. It covers both the interior and exterior of your house which includes garages, sheds, and other structures on the premises.
- Homeowners insurance not only provides protection for your house but also includes the personal property within your home in case of loss, damage or theft. Most homeowners insurance even offers coverage for your personal belongings like electronics, vehicles, and much more.
- Most homeowners insurance policies cover damages or physical injuries caused to any visitors who may be inspecting your property. It protects you from lawsuits due to the injuries of others. This will keep you from having to pay any excess medical bills.
- Some insurance policies also cover rental charges while your home is being rebuilt or repaired.
- Having homeowners insurance will also help you gain investment from mortgage lenders easily. Most mortgage lenders prefer to invest in properties protected by insurance as homeowners insurance assures the return of their acquisition by covering losses and damages to your home.
- Most insurance providers offer free homeowners insurance quotes that help you find the best insurance for your home and belongings.
What does homeowners insurance cover?
People typically purchase two kinds of homeowners insurance- Homeowners Policy Special Form 3 or HO-3 and HO6. Along with these two, most standard homeowners policies comprise of six distinct coverages as mentioned below:
1. Dwelling coverage
Dwelling coverage protects your home along with any attached structures or permanent fixtures. This includes decks, cabinetry, and even your garage, from damage caused by any detrimental instances that may occur. It also covers the payment required for repairs. The amount covered is usually determined by the square footage of your home and what it would cost if it needed to be rebuilt. This coverage typically does not take into account the market worth of your home. Instead, it compensates for the actual costs of repair. It is always wise to set your coverage limit at the cost to rebuild your entire home. This will help you minimize unnecessary coverage payments and get the maximum claim needed to rebuild your home.
2. Other structures
Other structures cover repairs or replacements for structures within the insured property that are not part of the home. This may include a detached fence or garage that was damaged during the incident.
3. Personal property coverage
Personal property coverage covers the cost of any loss of your personal belongings. This may include things like furniture and electronics. It helps you pay to replace your insured personal belongings in case of theft or damage. This type of insurance covers your property wherever it’s located. This means that your belongings do not need to be in your home during the time of loss or damage in order to claim the coverage. This is usually set at 50% of your dwelling coverage, but the limit can be cut down or increased depending on your needs.
4. Living expenses
This coverage pays for any short-term living costs. This includes rental value or hotel bills if the insured premises are considered uninhabitable due to things like a fire or a tornado.
5. Liability
Liability coverage provides compensation in the event that you or a member of your family accidentally damages someone else’s property or injures someone. It covers most legal fees, medical bills, and repair totals. It provides you with legal defense and helps you tackle the costs of damages. You can even purchase an umbrella policy to meet the costs of liabilities if your liability limits are not high enough.
6. Medical expenses
Medical expenses coverage or “Good Neighbor” coverage pays for the medical bills of visitors or third parties accidentally injured on your property. It helps pay any medical bills that occur during the incident regardless of fault.
You can also add other endorsements to your coverage. These include scheduled personal property, ordinance, law coverage, water backup, equipment breakdown, and service line protection. Most homeowners insurance either provides replacement costs or actual cash value for any damages. While actual cash value coverage provides the amount required to repair or replace your damaged property, replacement cost value coverage pays the amount for repairing your home with materials of similar quality that are within your policy’s dwelling coverage limits.
Homeowners insurance deductibles
All homeowner’s policies have a limit on payment and include an insurance deductible. While the limit is the maximum amount your insurance policy will pay toward a covered claim, the deductible is the amount you’re required to cover before your insurer begins reimbursing your claim. The deductible can either be a flat fee or a percentage of the home’s insured value.
Expert assurance for your homeowners insurance
If you plan to purchase homeowners insurance, it is always advised to keep the points mentioned above in mind and seek advice from an expert. Make sure that your insurance provider walks you through all the coverages under your insurance and helps you get a homeowners insurance quote without any hassle.
TX Insurance Quotes is one of the trusted homeowners insurance companies in Texas, with over 35 years of experience in the industry. We cover all types of homeowners insurance and offer homeowners insurance quotes based on your needs. Thus, get expert advice and homeowners insurance quotes with TX Insurance Quotes today!
