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What does home insurance cover?
Compare what's covered with home insurance and how to pick the right coverage.
Insurance makes sure you’re covered if the worst happens, but for home insurance, the coverage you need will depend on where you live and the nature of your home. Carefully consider all of your options to help build a home insurance policy customized to your needs.
What home insurance coverage can I get?
Home liability coverage
Home hazard coverage
Water backup coverage
What other coverage add-ons can I get?
Home business insurance coverage
Identity theft coverage
Green updates coverage
Landscaping damage coverage
What does home insurance cover?
Most base homeowners insurance policies are made up of the following coverage elements:
- Dwelling. Covers the structure of your home, such as the ceilings, floors, roof and walls. It also covers items that are permanently attached to your home, like windows and doors.
- Other structures. Protects other structures on your property, like sheds, fences and mailboxes.
- Personal property. Provides compensation for damaged or lost personal property anywhere in the world, if it belongs to your home. High-value belongings like jewelry, high-tech electronics and fine art aren’t covered and should be scheduled separately as part of a rider or individual policy.
- Loss of use. If your home becomes unlivable because of damage, this coverage provides compensation for any food and lodging costs that are more than your typical living expenses.
- Personal liability. If negligence causes an injury to a guest or damages their property, this covers compensation for them.
What home insurance coverage add-ons can I get?
Depending on where you live and what kind of house you own, you may want to consider this additional protection:
- Medical payments. Covers any medical costs for anyone who is injured on your property, regardless of who is at fault.
- Identity theft protection. This protection sometimes comes with a credit monitoring service. But it only applies if your personal information is used to defraud or open new accounts, which according to the Department of Justice, only makes up 6.6% of cases.
- Natural disasters protections. Often your standard policy doesn’t cover natural disasters like floods or earthquakes, but you can elect to purchase endorsements that provide this protection.
- Scheduled personal property. This add-on is designed for high-value personal property. It allows you to submit appraised values so that you can insure items individually and be covered for their full value.
- Equipment breakdown. Covers damaged appliances, home systems and smart home devices.
- Siding protection. Under a standard policy, only damaged siding is replaced. But if weather or age has caused the colors to fade, or if your original siding isn’t available anymore, this add-on provides extra money to help replace all of the siding so that the colors and textures match.
- Sump pump and water backup coverage. With this addition to your policy, flooding damages caused by sump pump failures or backups are covered.
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Home insurance coverage breakdown
For a standard homeowners policy, you can expect to pay around $35 per $100,000 value of your home, depending on where you live. And if you’re carrying a mortgage on the property, your bank can dictate what kind of coverage is required while you pay off the loan.
Below we’ve listed out common insurance coverages with estimates of their cost. Keep in mind that these are estimates and may not be accurate to where you live.
|Name||Definition||Covers||Loan requirement||Annual cost|
|Dwelling||Damage to the structure of your home||Walls, ceilings floors||Yes||$35 per $100,000 of home value|
|Other structures||Damage to other structures on the property||Outbuildings, detached garage, fence, pool, mailbox, etc.||Yes||$35 per $100,000 of home value|
|Personal property||Damage to personal property||Personal belongings||Yes||$35 per $100,000 of home value|
|Loss of use||Living expenses if your house is uninhabitable||Rental property, food and other living expenses||Yes||$35 per $100,000 of home value|
|Personal liability||Compensation for property damage or injury to a third-party||Third-party personal belongings and injury compensation||Yes||$35 per $100,000 of home value|
|Medical payments||Compensation for medical bills, regardless of who is at fault||Medical bills||Sometimes||Varies; based on the amount of coverage|
|Identity theft||Protection for instances of fraud or creation of new accounts||Varies; but can cover a specialist, legal help, resolutions services and lost wages||No||$25 to $50|
|Sump pump and water backup||Damages from flooding due to a faulty sump pump or water backup||Damages to the home, including flooring, structural, etc.||No||$40 to $50|
|Scheduled personal property||Damage or loss to high-value property||Jewelry, fine art, collectibles, furs, silver tableware, etc.||No||Varies based on the value of belongings|
|Siding protection||Damage to your siding that requires a color or texture match||Siding of your home||No||$25|
|Equipment breakdown||Damages to home equipment||Appliances, electrical equipment, home systems and smart home devices||No||$25 to $50|
|Natural disaster coverage||Damages due to flood, earthquake, or other catastrophe||Everything covered by the base homeowners policy||No||Flood: $700|
Earthquake: from $800 to $5,000 depending on the area and home being insured
The nice thing about homeowners insurance is that it’s customizable to your needs. To best compare home insurance policies, balance out what kind of coverage you’re looking for with the amount that fits your budget. And don’t forget to ask about available discounts.
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