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Summary
of Selected Homeowner Insurance Policy Coverages
A standard homeowners insurance policy includes
four essential types of coverage. They include:
1. Coverage
for the structure of your home.
This part of your policy pays to repair or rebuild your home if it is damaged or destroyed by fire, hurricane,
hail, lightning or other disaster listed in your policy. It will not pay for damage caused by a flood, earthquake or routine
wear and tear. When purchasing coverage for the structure of your home, it is important to buy enough to rebuild your home.
Also, remember that under Texas Department of Insurance guidelines, the structure coverage also covers replacing the slab
under a worst case situation, and removal of house debris in the event of a serious loss.
Most standard policies also cover structures that are detached from your home such as a garage, tool shed or gazebo.
Generally, these structures are covered for about 10% of the amount of insurance you have on the structure of your home. If
you need more coverage, talk to your insurance agent about purchasing more insurance.
2.
Coverage for your personal belongings.
Your furniture,
clothes, sports equipment and other personal items are covered if they are stolen or destroyed by fire, hurricane or other
insured disaster. Most companies provide coverage for 50% to 70% of the amount of insurance you have on the structure of your
home. So if you have $100,000 worth of insurance on the structure of your home, you would have between $50,000 to
$70,000 worth of coverage for your belongings. The best way to determine if this is enough coverage is to conduct a home
inventory.
This part of your policy
includes off-premises coverage. This means that your belongings are covered anywhere in the world, unless you have decided
against off-premises coverage. Some companies limit the amount to 10% of the amount of insurance you have for your possessions.
You have up to $500 of coverage for unauthorized use of your credit cards.
Expensive items like jewelry, furs and silverware are covered, but there are usually dollar limits if
they are stolen. Generally, you are covered for between $1,000 to $2,500 for all of your jewelry and furs. To insure
these items to their full value, purchase a special personal property endorsement or floater and insure the item for it's
appraised value. Coverage includes accidental disappearance - meaning coverage if you simply lose that item. And there is
no deductible.
Trees, plants and shrubs are also covered under standard homeowners insurance. Generally you are covered
for 5% of the insurance on the house - up to about $500 to $1,000 per item. Perils covered are theft, fire, lightning,
explosion, vandalism, riot and even falling aircraft. They are not covered for damage by wind or disease.
3. Liability protection.
This covers you against lawsuits for bodily injury
or property damage that you or family members cause to other people. It also pays for damage caused by your pets. So, if your
son, daughter or dog accidentally ruins your neighbor's expensive rug, you are covered. However, if they destroy your rug,
you are not covered.
The liability portion of your policy pays for both the cost of defending you in court and any court awards
-- up to the limit of your policy. You are also covered not just in your home, but anywhere in the world.
Liability limits generally
start at about $100,000. However, experts recommend that you purchase at least $300,000 worth of protection. Some
people feel more comfortable with even more coverage. We generally write our homeowners policies with $500,000 in liability
coverage - it's too cheap not to. You can purchase an umbrella or excess liability policy which provides broader coverage,
including claims against you for libel and slander, as well as higher liability limits. Generally, umbrella policies cost
between $200 to $350 for $1 million of additional liability protection.
Your policy also provides
no-fault medical coverage. In the event a friend or neighbor is injured in your home, he or she can simply submit medical
bills to your insurance company. This way, expenses are paid without their filing a liability claim against you. You can generally
get $1,000 to $5,000 worth of this coverage. It does not, however, pay the medical bills for your family or your pet.
4. Additional living expenses in the event you are temporarily unable to live
in your home because of a fire or other insured disaster.
This pays the additional costs of living away from home if you can't live there due to damage from a
fire, storm or other insured disaster. It covers hotel bills, restaurant meals and other living expenses incurred while your
home is being rebuilt. Coverage for additional living expenses differs from company to company. Most policies provide
coverage for about 20% of the insurance on your house. Some companies also now include this coverage if your home becomes
uninhabitable due to sudden discharge of water.
If you rent
out part of your house, some companies will also reimburse you for the rent that you would have collected from your tenant
if your home had not been destroyed, if you have additional endorsement coverage.
Note: Not all products are available in all
states. Information presented on this Web site is not a policy document or official program guide. The actual insurance contract
is contained only in the policy. Insurance protection may vary from the coverages shown, depending on the standard coverages
included in the policy and the optional coverages purchased. Please check the actual policy documents and/or state-specific
program guides for details on coverages, eligibility, exclusions, limits, deductibles and restrictions, which are subject
to change. Or call your marketing representative.
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to come by and visit about your needs.... and be sure to protect your home and family with Farmers Life Insurance!
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