What Does Homeowners Insurance Cover?
We get that. But even if it’s not exciting, getting the right homeowners insurance is a critical piece of ensuring your financial well-being. So it’s important to take the time to understand what homeowners insurance covers and work with your independent insurance agent to put together a policy that will protect your home and offer you peace of mind.
Most homeowners insurance policies will include the following standard coverages:
- Dwelling: covers the physical structure of your home, both inside and outside, in case of damage caused by storms, fire, theft, etc.
- Other structures: covers additional structures on your property, such as a shed and/or a detached garage.
- Personal property: protects the belongings inside your home in case they are stolen or damaged; some policies may also offer protection if the theft or damage of your property occurs in a different location. Some specific, high-value items, such as jewelry, may require additional coverage called a “rider”.
- Liability: provides financial protection in case someone sues you or makes a claim against you due to an injury that occurred on your property.
- Guest medical: covers the cost of medical expenses for a guest who was injured on your property.
- Additional living expenses: in case you and your family are temporarily displaced after your home has been damaged, this coverage may pay for living costs such as a hotel, rental property, eating out, etc.
Important Additional Coverage in Florida: Flood Insurance
Now that you know what standard homeowners insurances covers, it’s also critical to know what it does not cover: damage to your home from earthquakes and floods. For instance, while your homeowners insurance may cover damage to your home caused by a hurricane, your home is not covered if the hurricane caused a damaging flood. Therefore, to protect your home from water damage due to flooding, you should consider purchasing additional flood insurance in addition to your homeowners insurance. In fact, this additional coverage may be required if you live in a specified “flood zone”.
What Does Homeowners Insurance Cost?
The cost of homeowners insurance policy varies greatly from home to home, and is dependent on a number of specific factors, such as:
- The size of your home
- The location of your home
- Additional features such as a home security system
- Additional “riders” for high-value personal property
- The amount of insurance coverage you want or need
The goal of homeowners insurance, when possible, is to purchase a policy that will cover 100% of the cost of rebuilding your home should it be damaged or destroyed. At a bare minimum, most policies will cover “actual cash value”, or what the home was worth at the time of damage minus depreciation. A more comprehensive policy will cover “replacement cost”, which does not deduct depreciation. The most comprehensive option is “extended value” coverage, which will pay you up to 30% more than your coverage limit, depending on the policy you choose. While more expensive, this will protect you against sudden hikes in construction costs because everyone in your area needs to rebuild after a damaging storm, for instance.
The good news is that there is a very competitive market for homeowners insurance, so it’s possible to shop around among different companies to find the most comprehensive policy at the lowest cost to you. A local insurance agent such as Sungate Insurance Agency can help you gather quotes from a number of reputable companies and ensure that you are getting the right coverage at the right price!
Contact Sungate Insurance Agency serving Orlando, Lake Mary, Longwood, Heathrow and other Florida-area homes and businesses!
We are the insurance experts at your local insurance company. Contact us today to discuss your homeowners insurance needs, and to get a free quote!
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