Home Insurance

As with any properly constructed policy Homeowners insurance should be customized to fit your lifestyle and evolve with you and your home

Homeowners Insurance

Homeowners Insurance: What It Covers (and Why It Matters)

Home Is Everything

Home is more than just walls and a roof. It’s that warm bed you never want to leave on a rainy morning. It’s where cookies bake during the holidays and where your family laughs over dinner. It’s peace. It’s love. It’s memories.
That’s why protecting it with the right Homeowners insurance coverage isn’t just smart – it’s essential.

What Homeowners Insurance Covers

Homeowners insurance isn’t just about the house – it’s about protecting everything inside and around it, including you. A typical policy comes with six core coverages plus a menu of optional add-ons you should absolutely know about.
Let’s break it all down.

Coverage A: Dwelling

This protects the physical structure of your home and anything attached to it – think walls, roof, garage, deck. The coverage amount should reflect the cost to rebuild your home today, not what you paid for it years ago.

Smart add-ons:

Extended Replacement Cost: Adds 25%-50% more coverage beyond your base dwelling limit.
Inflation Guard: Automatically increases your dwelling limit each year to keep up with rising costs.
Ordinance or Law: Covers additional costs to bring your home up to current building codes after a covered loss.

Coverage B: Other Structures

Protects detached buildings like sheds, fences, gazebos, and detached garages. Typically capped at 10% of your dwelling limit, but this can be increased if needed.

Coverage C: Personal Property

Covers your belongings – furniture, clothing, electronics – whether they’re in your home or on vacation with you.

Key tips:

Standard coverage is usually 50% of dwelling coverage.
Add Replacement Cost endorsement to avoid depreciated payouts.
Limitations apply to high-value items (jewelry, art, firearms, etc.).
Schedule high-value items separately for full protection.

Coverage D: Loss of Use

If a covered disaster makes your home uninhabitable, this pays for additional living expenses while you are displaced – like hotel stays, food, and laundry. Learn more about this coverage here.
Coverage is typically 20%-30% of your dwelling limit or for a specific time frame (e.g., 12 months).

Coverage E: Personal Liability

If someone is injured or their property is damaged and it’s your fault, this pays for their damages – and your legal defense.

Pro tip: Don’t skimp here. Lawsuits get expensive fast. Consider raising your limits and pairing this with Umbrella Insurance.

Coverage F: Medical Payments

Medical Payments (Coverage F) is for your guests who get injured on your property. But, just like Liability coverage, Medical Payments could be applicable even if the incident occurred outside your house. This coverage is considered to be a goodwill gesture and is designed to prevent lawsuits.

Optional Coverage You Should Seriously Consider

Here’s where things get even more customizable – and where you can link out to deeper posts on each topic:

Personal Injury Liability

An important addition in our day and age is an optional liability coverage called Personal Injury. It is not meant for somebody’s physical injury, but rather emotional. For example, your teenager posts an unpleasant comment about a classmate, thus humiliating this person. This coverage is for false arrests, invasion or violation of privacy, slander, and defamation of a character.

Of course, adding it to your insurance does not give you a license to write or say what you please. It will have exclusions for any intended acts, just like any other coverage.

Home Business Coverage

Standard policies won’t protect business equipment or liability. If you run a business from home, consider this endorsement.

Increased Limits on Personal Property

Customize the limits for valuables like:

Jewelry
Art
Collectibles
Musical instruments

Equipment Breakdown

Covers damage to major appliances, HVAC, or electrical systems caused by mechanical or electrical failure – not typically included in basic coverage.

Service Line Coverage

Pays for repairs to underground utility lines (sewer, water, electrical) connecting your home to the street. Surprisingly common and expensive!

Water Backup Coverage

Protects against water damage from backed-up drains or sump pump failure – not covered by standard policies.

Cyber Protection and Identity Fraud Coverage

Your home might be protected against fire or theft – but what about hackers?

Cyber Protection and Identity Fraud Coverage is an optional endorsement that helps safeguard you from the financial fallout of digital threats. It’s especially important if you:

Shop or bank online
Use smart home tech
Store personal data on your devices
Work from home

This coverage can include:

Identity theft restoration services
Reimbursement for stolen funds and legal fees
Data recovery costs
Cyberbullying support
Unauthorized use of smart home systems

As more homes go “smart,” the risks go digital. This coverage gives you peace of mind in a wired world. Learn more about the coverage here.

Additional Insurance Policies You Should Absolutely Consider

Even the most comprehensive homeowners insurance policy has its limits. That’s why it’s smart to look at a few extra policies that can make all the difference when life throws a major curveball. These add-on policies – like Flood, Earthquake, and Umbrella insurance – cover what your standard home insurance doesn’t.

Flood Insurance

Homeowners policies exclude flood damage. This must be purchased separately. It’s a must-have if you’re in a flood-prone area.

Earthquake Insurance

Also excluded from standard policies. California homeowners especially should consider this add-on.

Umbrella Insurance

Provides additional liability coverage above your Home (or Condo, Renters, Landlord) and Auto policies. Great for higher-net-worth households or anyone who just wants peace of mind.

Bonus California Note: Workers' Compensation

California Homeowners policies usually include limited Workers’ Compensation coverage – even if you don’t have official employees. This can cover injuries to occasional workers like gardeners, pool cleaners, or housekeepers. Still, always hire licensed and insured professionals!

Deductibles: Your Share of the Risk

Your deductible is what you’ll pay out-of-pocket before insurance kicks in. Common options: $1,000 or $2,500. A higher deductible often means lower premiums – but make sure it’s affordable for you in case of a loss.

Final Notes

Always choose the “Special” form over Basic or Broad for the broadest protection.
Review your policy every year or after a major remodel.
Get help from a licensed broker (like us!) who can explain your options clearly.
Remember: Home insurance is not a maintenance plan. It’s protection for accidents, disasters, and the unexpected.

Because Home Is Everything

Your home is your sanctuary – your safe place. Let’s make sure it stays that way.
Need help reviewing your Homeowners policy or exploring coverage options? Contact us today to make sure your home (and your heart) are properly protected.