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HomeOwners Insurance

Homeowners insurance, also known as, property insurance, protects you from damages to your residence, which includes your garage and personal property, which includes your furniture. It is also for liability, in case an accident occurs on your property, and living expenses, in case you have to live elsewhere while your home is repaired or rebuilt. It is paid with your monthly house payment, if you have one, or yearly, if you own your home outright.

Damages to your residence are the dwelling you live in, attached or detached garage, and possibly some other detached structure like a swimming pool or shed. Personal property is your furniture, appliances, and some items you wear, although not necessarily your jewelry and other collectibles. Those may require additional insurance depending on how much they are worth. Basic jewelry, that isn’t over expensive, tends to be included. Liability is for anyone that is hurt on your property, this could include someone tripping on your child’s skates.

All homeowners insurance is based on three factors: how many claims have been made in your area, your personal claim history, and value of your home. Obviously if your area has a history of tornado claims, you will pay a higher price because chances are you will have one at some point in living there.

Your personal claim history can be bad for a few reasons. Not only will having multiple claims raise your premium, but eventually your renewal may be denied. If this happens you may also have trouble getting a new policy with a different company. Repair or replacement of your home can vary based on two aspects. These are replacement value of your home or its actual cash value. Replacement cost will protect you from inflation, in the case that building costs have increased when you need to replace or repair your home.

The cash value will pay you for what your house is actual worth at that time. You also have a deductible for any claims you make, just like with car insurance. And security features can also lower your premium by having sprinklers or a home security system in your house. These can help because your house may not totally burn down or have anything stolen with items such as these, and insurers like this because then they don’t have to pay out as much to repair or replace your home.