According to an article written in US News (https://www.usnews.com/insurance/homeowners-insurance/how-to-buy-homeowners-insurance), homeowners insurance covers damages or losses to your home, personal belongings, or even individuals injured on your property.

Here is a breakdown of the standard coverage offered to a homeowner’s insurance policyholder:

Dwelling coverage
Applies to damage done to your home caused by fire smoke, theft, vandalism, or severe weather. Although damages from lightning, wind, and hail are typically covered, you will need to buy separate insurance for floods and earthquakes. Coverage extends to other detached structures on your property, like a garage, barn, or shed.

Personal property coverage
Insures your personal belongings, including furniture, appliances, electronics, and clothing. Reimbursement for lost or damaged belongings can either be for the full replacement value or the actual cash value of the item after depreciation. You may need to pay for higher premiums or purchase additional coverage for valuable belongings, like art and jewelry.

Personal liability coverage
Can help protect you if someone is injured on your property. If you are sued, your policy can help pay for your legal expenses and fees. If they are injured, it can also cover their medical expenses, including X-rays, ambulance rides, and hospital stays.

Living expenses coverage
Will help pay for expenses if you are displaced from your home as a result of a covered condition. This can include fire, tornado, or other immediate or imminent hazards because of which local authorities bar you from your neighborhood.

Types of homeowners insurance

From the state of Florida’s Department of Consumer Services (https://www.myfloridacfo.com/division/consumers/understandingcoverage/homeownersinsuranceoverview.htm): there are many different types of homeowners’ insurance policies available. The type of policy coincides with the type of structure to be insured and how the structure is occupied; the type of policy also correlates to the coverage available as well.

Owner-Occupied: The main difference between policies which cover an owner-occupied, single family home is the perils covered. Basic or Broad Form policies (HO-1, HO-2) cover the structure for specified perils shown in the policy. Special form policies (HO-3) cover the structure for all perils except those specifically excluded in the policy.

Condo unit owners: Need a Condominium Unit-Owners Form (HO-6) which provides some coverage for the structure but primarily covers the personal property and liability of the insured. Condo unit owners’ policies normally cover named perils listed in the policy. However, a special endorsement can be purchased to broaden the policy to cover all perils except what is excluded in the contract. The condo unit owners’ policy also provides Loss Assessment Coverage. It pays for your share of expenses for a covered loss to common property shared by all unit owners, up to the coverage limit. Policies must include at least $2,000 of loss assessment coverage with a deductible no greater than $250.

Renters: If you rent or lease your home, you need a renter’s policy (HO-4) to cover your personal property and liability.

Modified Coverage Form: Currently, in Florida, there are many insurers offering a Modified Coverage Form, (HO-8). The (HO-8) offers less coverage than the (HO-2). However, due to the company’s underwriting criteria, this may be the only coverage form offered by the insurer.

Dwelling Form: There are other property policies available for risks that may not qualify for a Homeowners policy. They are called Dwelling Forms. A Dwelling Form may be used instead of a Homeowner’s Form in the case of an older home, a home that is rented to others, or for other underwriting reasons.

Mobile Home: Many insurers have discontinued the sale of mobile home policies that duplicate Homeowners’ policies. Some insurers issue a dwelling form (discussed below) to cover a mobile home.

What homeowners insurance does not cover

Before purchasing a homeowners insurance policy, you should understand what is and is not covered. This is especially important for first-time home buyers. While there are variations between policies, generally most homeowners’ insurance policies do not pay claims if the damage was caused by: flood, earthquake, windstorm, hail, poor home upkeep, sewer back-ups.
Pets and vehicles are also not covered under a homeowner’s insurance policy.

Who needs homeowners insurance?

While there is no law that requires home insurance, mortgage lenders do require you to get home insurance coverage before they will agree to finance your home purchase. Home insurance protects their investment by providing the money to repair or rebuild the home if it is damaged or destroyed by a fire, a lightning storm, a tornado or some other covered event.

If you don’t have a mortgage, it’s a good idea to protect the equity you have spent years building. Homeowners insurance can help protect that investment well into the future.

Related Links:
How the Home Insurance Claim Process Works
Homeowners Insurance Deductible Explained

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