Homeowners Insurance protects you and your home, condo, manufactured home or dwelling under construction from theft, fire, lightening, vandalism, exposision, falling objects, sudden and accidental water damage and weight of snow, ice or sleet. We make sure you have adequate coverage for your home and belongings.
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What does a homeowners insurance policy cover?
If something unfortunate happens to your home or at your home, homeowners insurance helps to protect your finances, your personal belongings, the cost of alternative living arrangements, and legal expenses if needed.
Main areas of coverage for your home
- Dwelling or Home Structure: Protects the physical structure of your home, such as the roof and walls, built-in appliances, carpeting, flooring, an attached garage, breezeway or carports.
- Other Structures: Covers the physical structure of other buildings on your property, such as a fence, detached buildings or permanently installed pools.
- Personal Property: Protects items you store inside of your home, even if they’re damaged or stolen outside of the home, such as clothing and furniture.
- Liability Protection: Protects you if someone sues you after they’re injured on your property or after their property is damaged.
- Guest Medical Protection: Helps to pay medical or funeral expenses for someone who is injured on your property.
- Loss of Use: Covers the expenses of new living arrangements if you’re unable to live in your home after a covered loss.
Beyond the standard coverage, there are add-ons including coverage for:
- Sewer and drain backup
- Service line protection
- Ordinance and Law protection
- Identify theft
- High-value item coverage: Collections, jewelry and guns as examples.
- Additional replacement costs
- Mechanical breakdown coverage
- Personal injury
- Personal umbrella protection
Is it required?
Homeowners insurance is not required by law. However, if you have a mortgage or are trying to get a mortgage, your lender will likely require you to have homeowners insurance on the property to protect the financial investment they’re making by lending you financing.
Whether you owe on a mortgage or fully own your home, just like a lender, you may want homeowners insurance to protect your investment and to make sure you’re prepared in the unfortunate event that damage is done to your home.
What determines the cost of a homeowners insurance policy?
Your home, finances, and coverage
- Location: The location of your home impacts the cost to insure it. Factors considered include local weather conditions, population density, frequency of natural disasters and wildfires, and proximity to a fire station.
- Home: The older your home is, the more expensive it can be to insure. The materials it’s made from can also affect the cost of insurance, as they can affect the risk an insurance company takes on to insure the home.
- Insurance score: A higher credit score shows an insurance company that you responsibly and consistently manage your assets and debts. This gives you credibility and will likely lower your insurance premiums as you are less of a risk to insurers.
- Coverage amount: If you choose high coverage amounts and low deductibles (the cost you pay out of pocket), your premiums will also be higher to cover the costs of the more thorough insurance coverage.
- Claims history: Your insurance premiums will likely be higher if you’ve had to file multiple insurance claims in the past, or if your home has had a history of damage and loss. This is also true if your home is in a location that has a history of high claims.
- Updated items: Roofing, wiring, plumbing and heating and air conditioning.
Safety and security features of your home
Having or adding these safety and security features to your home can help lower your insurance premium when you inform the insurance company that you have:
- A security system
- Deadbolt locks on exterior doors
- Smoke detectors
- Fire extinguishers
- A sprinkler system
How much of each insurance component do you need?
When assessing how much coverage to purchase for your home, many of the components will be based on the coverage amount you decide for your Dwelling or Home Structure coverage. This should equal the house’s full replacement cost – what it would cost for a full rebuild, rather than the home’s purchase price or market value.
From there the following limits are typically set for each of the following coverage areas, based on your Dwelling coverage:
- Other Structures: 10% of your Dwelling coverage limit
- Personal Property: 50% of your Dwelling coverage limit
- Loss of Use: 20% of your dwelling coverage
Liability coverage should cover all of your financial assets, including your home and other investments, such as automobiles or retirement accounts. If you are sued because of an injury to another person or their property, this will protect these assets. The highest standard coverage is $500,000 but if you want more coverage, you can add an umbrella policy.
For coverage for medical payments to others, policies typically offer between $1,000 to $5,000 in coverage.
What does it mean to make a claim?
If an event happens at your home that is covered by your homeowners insurance, you will want to file a claim so that your insurance company will reimburse you for the cost of the damages or loss.
Before filing a claim, review your policy to make sure the damage or loss is covered and to understand if you need to pay a deductible before receiving reimbursement.
When you file a claim, you’ll need to share as much information about the damaged or stolen property as possible so that the insurance company can move forward with processing your claim and determining your reimbursement amount.
Ask questions throughout the process to make sure you clearly understand what your coverage provides and what your options are for moving forward from the event.
Contact us to discuss bundles and discounts available for your homeowners insurance policy, as well as your coverage needs.
Schedule a virtual appointment for your full policy review and risk assessment from Frost & Remer. We will make recommendations to ensure that you have the best coverage possible, with a premium you can afford.