Homeowners Insurance

Quick Takeaways

  • Homeowners insurance is what is known as a “package policy” – this means it covers both actual, physical property and legal responsibility for injuries that happen while on that property
  • There are 3 common levels of coverage: actual cash value, replacement cost, and guaranteed/extended replacement cost
  • Beware weather exceptions – standard policies do not cover flooding, earthquakes, or poor maintenance

Source: Homeowners Insurance Basics (Insurance Information Institute)

Homeowners insurance is a crucial step in your journey to home ownership, in fact, you may not be able to obtain a mortgage without it. Your policy will cover both your property and events that may happen on your property. There are three basic kinds of homeowners insurance: actual cash value, replacement cost, and guaranteed or extended replacement cost.

Comparing insurance policies for coverage and price is always an important first step! Make sure you know the particulars or your coverage, and what it does and does not cover – for example, floods and other natural disasters are usually not covered by hone insurance.  Your location, type, and age of home as well as your personal history will determine the cost of your coverage.

See References for more information.