What Does Typical Homeowners Insurance Cover?

When disaster strikes the house you own, you can avoid catastrophic losses by owning homeowners insurance. This financial instrument covers many types of losses of your material and financial possessions, in addition to your residence.

Types

According to the Insurance Information Institute, the most popular type of homeowners insurance is HO-3, which covers the items described for single-family residences that are owned. Form HO-4 is for renters of their homes, while HO-6 covers condominium and co-op units.

Structure

Insurance pays to repair or rebuild a house if it is damaged by such disasters as fire, hurricane and lightning. Additional riders are needed for coverage during earthquake and flooding.

Belongings

Personal items such as furniture, clothing, computers and entertainment units are also covered, even if the device is not in the home during the loss. You can buy additional coverage for such valuables as furs, jewelry and art, if their value exceeds a specified limit.

Liability

If you are sued because a member of your family hurts others or damages their property, your insurance pays for that liability up to a specified limit, which generally start at $100,000.

Living Expenses

If your house becomes uninhabitable because of a covered situation, your policy pays for your living expenses like hotel stays and restaurant meals while your property is being rebuilt.

References

• Insurance Information Institute: Homeowners Insurance
• Geico: About Homeowners Insurance
• Farmers Insurance Group: Homeowners Insurance FAQs