Homeowners insurance

Homeowners insurance is a property insurance policy that covers losses and damages to an individual’s house and assets, as defined by the Insurance Information Institute (III). Standard homeowners insurance policies protect against perils such as fire, theft, vandalism, and certain weather-related damage; for example, in 2023, 85% of U.S.

Homeowners policies included fire coverage according to NAIC data. A typical policy requires a deductible payment before coverage applies; for instance, most deductibles range from $500 to $2,500 as reported by Bankrate in 2023.

Homeowners insurance usually excludes flood and earthquake damage unless separate riders are purchased–FEMA notes over 99% of U.S. Standard policies exclude flood protection, YourInsuranceInfo reports.

Replacement cost and actual cash value represent two primary valuation methods–replacement cost pays the full amount needed to rebuild without depreciation while actual cash value subtracts depreciation, as explained by III. Lenders mandate homeowners insurance for mortgage approval; Fannie Mae guidelines require proof of coverage before closing.

Homeowners insurance rates vary based on factors including location, claims history, home age, and construction material–Policygenius reports Florida had an average annual premium of $4,218 in 2023 versus Idaho’s $982. Personal liability protection in homeowners insurance typically covers legal costs if someone gets injured on your property; for example, coverage limits often start at $100,000 according to Allstate.

Additional living expenses (ALE) coverage helps pay for temporary housing during covered repairs–Insure.Com states ALE payouts averaged $8,785 per claim in 2022. Insurance companies may deny claims due to maintenance neglect or intentional damage–as noted by the National Association of Insurance Commissioners (NAIC), roughly 8% of claims were denied for these reasons in 2022.

To file a claim, contact your insurer immediately with documentation like photos and receipts; J.D. Power’s 2023 study found that digital claim submission improved satisfaction by 17 points on their scale.