If you have recently purchased a house and are thinking of the most suitable insurance policy, perhaps the thought of buying homeowners' insurance must have struck your mind. Homeowners' insurance will cover most of the crucial losses and damages that may affect your home over time.
Most standard homeowners' policies include three main types of coverage, which include.
Personal Belongings Coverage
Opting for homeowners' insurance means covering all your personal belongings in your home and anywhere else outside your home. The policy covers any theft of your personal property that occurs inside your home, storage facility, or in your hotel room. Personal property coverage also covers the goods or belongings staying in your home, and their things get stolen or damaged when in your custody.
The insurance, however, will only pay a limited amount of highly-priced items such as jewelry, firearms, watches, and other expensive valuables. You should expect about $1,500 of compensation when any of your valuables are stolen from an insured home, depending on the nature of the item in question.
Additional Living Expenses Coverage
Additional living expenses include the costs you incur when you're forced to live somewhere else as you wait for your house to be brought back to shape after damage. Typically, such damages are caused by natural disasters that aren't insured or covered in the homeowners' insurance. Additional living expenses coverage may cover the cost of rent at your temporary residence, hotel meals, gas costs, and other associated costs you may incur in that period.
However, this coverage has some limitations—the limitations will not affect the process of rebuilding your damaged home by your insurance company. Additional living expenses are covered for the time needed to repair your damaged home. If you choose to relocate permanently after the damage, you'll continue receiving payments until you settle in your new home.
Personal Liability Coverage
When you or any member of your family cause bodily harm or damage property belonging to someone else, a homeowners' insurance policy will help you go over the damages easily. Additionally, if your pets damage other people's property or cause bodily harm, the policy equally covers such damages. However, the policy doesn't include the damage you or your family and pets have caused to your property.
Liability coverage will cater for your legal fees when you're sued and taken to court for the damages you or anyone in your household caused to a third party. You can always choose the limit of your liability coverage, which typically ranges from $100,000.
You keep a copy of your insurance policy in your file drawer, but do you know how to read and understand the policy? Having an insurance policy will protect you from losses, but it won't protect you from all losses. To get a better understanding of what your policy will and will not cover, read through this blog. You will learn about all different types of insurance policies and learn the terminology used in the documents that you have read. Hopefully, by the time you have read through the content here, you will know exactly where your insurance policies are lacking so you can make changes.