If you own a home, there’s a good chance you have a home insurance policy. However, there is also a good chance that you purchased that policy without considering each type of coverage and how it affects you. This guide solves that problem by examining the components of a typical homeowners insurance policy, standard exclusions, and things that can affect your rate.
Home Insurance Coverages
Each policy has several components. While specialized coverages are available, these are the main parts of the most commonly written policies.
Liability — This portion of your policy protects you if someone is injured or killed on your property. It pays medical bills and costs associated with legal claims.
Physical structures — If a covered event damages your home or outbuildings, this portion of your insurance will pay to repair or rebuild it.
Personal property — The personal property section of your home insurance covers all of your stuff, such as furniture, clothing, tools, electronics, and kitchenware.
Loss of use — Many homeowners choose to add loss of use, sometimes called temporary housing, coverage to their policy. It pays for a place to stay during repairs if your home’s damage makes it uninhabitable.
Renters insurance, also called HO-4, is a special type of home insurance that provides liability and personal property coverage. It is an excellent option for individuals who want to protect their financial assets before purchasing a house.
Common Homeowners Insurance Exclusions
Reading through your current policy to check for exclusions is always a good idea. Otherwise, you could find yourself facing substantial losses and a denied claim. Some common exclusions include those related to the following:
- Earthquake damage
- Flooding, including sewer backups
- Non-listed hazards, such as a pool, trampoline, or undeclared dog
- Business property
Factors That Impact Home Insurance Rates
One of the biggest factors affecting your homeowners’ insurance rate is the estimated cost to rebuild the structure if it were to be destroyed. The likelihood of that loss is also considered. For example, homeowners in coastal areas often have trouble securing affordable coverage due to the prevalence of severe storms.
The deductible you choose will also impact your rate. A higher deductible will generally contribute to a lower policy cost. However, you will need to have cash reserves on hand to pay for any damages up to that amount.
Personalized Home Insurance for Utah Homeowners
Homeowners’ insurance policies have many components, which makes shopping for coverage challenging. The experienced agents at Wayne Peart Insurance Agencies can help you build a policy with the coverage you need to protect your family. Contact us today to request a home insurance quote.