When you buy a home, you want to ensure it’s protected against any unexpected damage. Investing in homeowners insurance saves you from costly repairs. However, you want to fully understand what that includes. So, here are some of the main things your insurance policy will cover.

What Is Homeowners Insurance?

Homeowners insurance will provide you with coverage to repair or replace damaged items due to fire, theft, or severe weather. The average homeowners insurance premium is $1,015 per year.  However, other factors, such as your property’s condition and your credit score, can play a role.

What Does the Policy Cover?

With the basics covered, you can start examining your policy. Here are some of the main things covered in a standard one.

1.  Your Personal Property

Your insurance policy should cover the expenses of replacing your personal belongings. This can include clothing, furniture, or appliances. You’re typically insured for 20-50% of your policy’s coverage limit. However, high-end jewelry or valuable items have special limits of liability.  This means the insurance company will only pay up to a certain amount.

To determine how much coverage you need, complete a home inventory. This consists of going through your home and determining how much each item is worth. Then compare the total with the amount of coverage included in your insurance policy. Many insurance providers offer policies that allow for additional coverage. Just keep in mind this will come at an extra cost.

2.  Your Home’s Structure

If a hurricane or fire damages your property, an agent will help you get coverage for the related expenses. This includes coverage for repairing your walls, roofing, or foundation. The policy can also cover structures not directly connected to your house. This may include a detached garage or fence.

To determine how much coverage you’ll need, determine the cost to rebuild your home. Call your local construction company or a real estate agent to get the best estimate.

3. Someone Getting Injured on Your Property

Your homeowners insurance will also include personal liability coverage. This will pay for any medical bills or lost wages of anyone injured on your property. It can also cover pet-related accidents, such as dog bites. If you’re taken to court, liability insurance covers your legal fees. Many policies provide a $300,000 limit. However, you should buy enough coverage to protect your assets.

4. If You Need to Relocate

Suppose a natural disaster impacts your home and you need to relocate temporarily. Your insurance will cover the expenses while your home is being repaired or rebuilt. These can include hotel costs or restaurant meals. Keep in mind these do come with limits. For a standard policy, it’s about 30% of your dwelling limit.

5.  Damage Due to Falling Trees

Suppose a fallen tree damages your property. The insurance company would cover removal costs. However, if the tree fell due to natural causes, like age, it wouldn’t be covered. You also want to look into your policy’s coverage limit. A standard one has a coverage limit of around 5%.

What Does a Policy Not Include?

While your homeowners insurance covers many expenses, it has a few limitations. Here are some of the things that are excluded from your coverage.

1. Flood Damage

Most policies will not protect your home from issues caused by flooding. This is why you should consider investing in flood insurance. The cost will depend on several factors, such as your flood risk and deductible.

However, it’s worth it to protect your home from mold growth and structural damage. It’s also crucial if you live in a coastal area. To find the right insurance, consider using the National Flood Insurance Program.

2. Improper Maintenance

Any damage caused to your property based on poor upkeep is usually not covered. For example, leaks due to lack of plumbing maintenance aren’t insured. Also, if you have an outdated air conditioner that causes damage, this is not covered.

3. Terminate Infestations

Damage caused by pests is often not covered because it’s seen as a preventable issue. Keeping your house clean and in proper shape can reduce your risk of an infestation. Also, to help protect your home, prevent moisture accumulation with gutters and downspouts.

Understanding Your Home Insurance Policy

Homeowners insurance may seem complex at first. However, it’s important to review your policy carefully to prevent any surprises. Keep in mind damage to your property and belongings is often covered, while issues caused by flooding usually aren’t. With this guide, you’re closer to peace of mind as a homeowner.