Almost everyone who owns or rents a house needs to have some form of home insurance coverage. There are several options on what kinds of coverage you can get and the amounts vary from individual to individual based on their needs. All mortgage companies require that you prepay for your home insurance coverage one year in advance before they will issue the mortgage. This coverage must remain current through the life of the loan. It is usually paid for as part of your regular mortgage payment with the funds being held in escrow until the annual payment date. There are four basic coverage elements that are parts of most policies: personal property, family liability protection, guest medical protection, and additional living expenses.
Personal property protection is the main component of your overall home insurance coverage. This covers all of the items you bought that are in and around your home. In case of a claim, you will be paid the cost of the item minus any depreciation that has occurred since the date you purchased the item. You can purchase this particular coverage based on estimating the total amount of the value of all of your marriages. There are caps and limits that insurance companies will put on certain items under certain circumstances. Be sure you understand the limits and exemptions of your policy.
Family liability is the next component of your home insurance coverage. This covers family members who are responsible to pay covered accidental liabilities for body or property damages. This coverage only relates to accidents and other covered occurrences which occurred in or around the home. This coverage does not cover auto claims where the family member may be found at fault and be held responsible for damages. The family member's auto insurance coverage would cover them under those circumstances.
Guest medical coverage is also an important part of your overall home insurance coverage. This protection provides for the payment of medical expenses for anyone who is hurt while in or on your property as a result of a covered loss. This coverage is limited to reasonable and necessary medical coverage, but not for damages associated with pain and suffering or loss of income. Those would be handled under other provisions.
Another necessary part of your home insurance coverage is additional living expenses coverage. This coverage is used when a covered physical loss makes your home unlivable for an extended period of time. This coverage will give you sufficient money to maintain your standard of living while you are not allowed to return to the lodging. It will cover additional costs of a place to stay such as a rental home or hotel. It will also pay for food and other increased living expenses.
It is important to remember that understanding your home insurance coverage is your responsibility as a home owner. Your insurance agent can suggest levels of coverage for each component, but the decision is extremely yours. Be sure to get quotes from several companies before making a final decision.
