Home Insurance Explained Most of us never have
the opportunity to have home
insurance explained, but it’s
more important now than ever
to understand the types of
home insurance that are
available to you. After all,
you’re protecting a very
expensive investment – your
home and its contents. The types of home
insurance typically available are: - Traditional Homeowners
Policy – A traditional home
owners’ policy includes
coverage for the structure of your home (the building), coverage for your personal belongings, reimbursement for living expenses in the event of a disaster, and liability protection for the homeowner. - Renters Policy – Renters insurance provides the same kind of personal property coverage and liability protection that a homeowners policy does. A renters policy will protect your personal belongings in case of a covered loss or damage, and will also protect you if you damage or destroy the landlord’s building.
- Condominium Owners Policy – A condominium owners policy protects the inside of the condo unit as well as your belongings. The condominium association should provide structural insurance to protect the building, since that is considered common property.
[Pullout: 
] - Disaster Insurance (Earthquake, Flood, Hurricane, etc.) – Traditional homeowners’ policies don’t cover floods, earthquakes, hurricanes and some other natural disasters. If you live in a designated flood zone, your lender will require you to buy flood insurance. You can buy flood insurance from your insurance agent, but the policy is provided by the Federal Flood Insurance Program. You can buy earthquake or hurricane insurance as a separate policy, and in some cases as an endorsement to your traditional policy.
An important part of having home insurance explained is receiving good information on how to decide the amount of insurance coverage you need to buy. -
- Real Property – This is your home, garage or carport, sheds and outlying structures. The value of your real property is usually based on the actual or assessed value of the buildings. Be sure to buy enough insurance to enable you to rebuild your home if it is destroyed or damaged.
- Personal Property – This includes the contents of your home and personal belongings. Many traditional homeowners policies provide personal property coverage for 50% of the amount of insurance you have on your home. If this isn’t adequate, you can increase your coverage or buy a Replacement Cost Insurance Policy that will cover your items for what they would cost to buy at today’s prices.
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