Given the variety of home insurance coverages, it is understandable why many homeowners, especially new ones, find the process of choosing an insurance overwhelming and confusing. Insurance should rate high on your priority list when house hunting. In fact, it’s going to be a requirement by most mortgage lenders.
At its most basic definition, home insurance provides coverage for personal liabilities arising from negligence, which most commonly involves damages inflicted on another person or property. Depending on your policy, you can even be covered for legal defense needs.
The Most Basic Policy
Among the basic types of homeowners insurance coverage that you can expect to be offered as options when you consult with a professional include is the HO-1 policy covering for natural disasters such as lightning, windstorm or hail, or volcanic eruption.
Damage from malicious acts like theft (capped at $1,000), malicious mischief or vandalism, riot or civil commotion, and damages from other elements like vehicles, aircraft, and smoke and explosions are also included in HO-1. This is most advisable for property owners who would like to ensure their property’s safety from all possible disasters, whether natural or man-made.
A Policy for Separate Structures
Meanwhile, if you have a separate structure within your property, such as a barn or garage, you may want to opt for HO-3. Remote structures, although separate from the main house are equally as vulnerable to damages, so it only makes sense for you to seek protection for it as well, and every item within it.
Do take note, however, that this kind of policy explicitly excludes certain perils, ranging from earthquakes to laws, to power failures, to wars, to nuclear hazards, to insects and animal damage (particularly if the damage was made by your own pet), as well as vandalism or wear and tear.
Insuring the Items You Own
If you are a tenant, you can’t really take out insurance for the property you are renting or leasing for the simple reason that you don’t own the place anyway. What you can insure, however, are the items that you do own within that property. For this, you’ll need the HO-4 policy, which also includes coverage for the insured tenant’s personal liability.
When getting insurance coverage for your property, therefore, make sure to choose the insurance policy or policies that best fit the type of property you inhabit and what you are using it for. Make sure to first seek consultation with insurance professionals, such as Focus Insurance Group, so that you avoid being overwhelmed by the variety of policies.
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