Property damage insurance

Property damage insurance protects policyholders against costs from physical harm to tangible property, including cars and buildings. Policies pay for repairs or replacement if incidents like vehicle collisions, fire, vandalism, or storms cause damage.

Auto liability policies in the US must include property damage coverage; for example, 49 states set minimum limits ranging from $5,000 (California) to $25,000 (Texas). Homeowners insurance typically covers damage to the insured dwelling and other structures on the property, such as garages and fences.

Property damage insurance excludes intentional acts and normal wear-and-tear as shown by standardized exclusions in ISO homeowner and auto forms. Claims require proof of loss through documentation like police reports, photos, or repair estimates.

Liability property damage coverage compensates third parties when the policyholder is legally responsible for damaging others’ property–examples include hitting another car or backing into a neighbor’s fence. Deductibles often apply to first-party claims but not to liability payouts, according to most carrier guidelines.

Premium costs depend on risk factors including property value, location, security systems (e.g. alarms), and claim history; for instance, homeowners with multiple prior claims may see rate hikes of 20%–40%. Commercial policies extend property damage protection to business assets like inventory, equipment, and signage in perils like theft or water damage.

Insurers determine payout limits based on policy endorsements; actual cash value settlements subtract depreciation while replacement cost coverage does not, according to documentation from YourInsurance.info (Your Insurance Info).