What’s Covered in Homeowner’s Insurance

For most people, the home is their largest financial asset, making it critical to protect it adequately against loss or damage. Most standard homeowner’s insurance policies provide protection not only for the home, but also for personal property such as furniture, clothing, and appliances. Most policies offer personal liability coverage as well.

Your policy can protect you from a variety of events, including fire, lightning, burglary, vandalism, storms, explosions, and more. Coverage varies depending on the provider and the policy, so examine your policy carefully to find out which events are covered and to what extent. Also, keep in mind that most standard policies do not cover damage or loss due to events such as an act of war, nuclear accident, flood, earthquake, or terrorism.

Structure replacement and repair
A homeowner’s insurance policy mainly provides funds to repair or rebuild your house in case of accidental damage or even total destruction. Although many factors determine the dollar amount of your policy’s coverage, you need to be sure your policy provides enough coverage to rebuild or repair your home at current construction rates. You need not factor the cost of the land into this calculation, so the insurance amount may be less than the purchase price or loan amount. Consult your policy for details and consider increasing your coverage if necessary.

Coverage for personal possessions and liability
Homeowner’s insurance may also cover your personal property such as clothing, furniture, appliances, and other belongings. Standard policies set a maximum reimbursement limit, but you can purchase additional coverage to insure special items like artwork, jewelry, or collectible items.

Most homeowner’s policies also cover accidents that occur on your property—if the mailman slips on your sidewalk, for example, or if a neighbor is injured in your backyard. Many policies will even cover your liability for accidents that occur away from your property. For example, if you run a shopping cart over someone’s foot at the grocery store, many policies will cover the medical bills. Carefully read your homeowner’s insurance policy to determine exactly what coverage it currently provides.

Review and revise
Actually, it’s a good idea to review your insurance policy at least once a year to make sure your coverage grows as your home’s replacement value increases or as you accumulate more valuable possessions. For a complete review of all your insurance policies, contact a SchoolsFirst Insurance Services agent at 800.462.8328 or email insurance@schoolsfirstfcu.org.

CA Insurance License 0I19344

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Extra Credit provides general information to help improve our Member’s financial lives. Every situation is different, so please contact us for guidance on your specific needs. The advice provided in Extra Credit is not intended to serve as a substitute for speaking to a loan representative, financial advisor, or BALANCE counselor who can help tailor a solution for you.

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