Home Insurance

Home insurance (also known as homeowner insurance) it’s a necessity because it protects you and your family in many kinds of situations like disasters, burglary, and liability. Without insurance, you’ll be responsible for protecting your property, possessions and liability exposure.

Home insurance, also called homeowner’s insurance (often abbreviated in the US real estate industry as HOI), is a type of property insurance that covers a private residence.


Homeowners insurance protects your financial interests if your home is damaged or destroyed by a covered peril.

A typical home insurance policy contains two parts. One part contains coverage for property damage to the home, garage and other buildings on the property. The second part of the policy contains liability coverage.

The types of home insurance coverage you purchase may be dictated by your proximity to potential sources of flooding (such as rivers) and risk factors in general. Types of coverage include:

  • Dwelling and other structures coverage can pay to repair or rebuild your home or detached structures like garages, sheds and fences if damaged by a covered cause of loss.
  • Loss of use coverage can pay your additional living expenses if you must move out of your home temporarily while it’s being restored.
  • Personal property coverage can pay for your household contents and personal belongings.
  • Personal liability coverage can help protect you in the event of a claim and can provide a legal defense if you or a member of your household is responsible for causing injury or property damage.

All insurance is definitely not equal. The least costly homeowners insurance will likely give you the least amount of coverage, and vice versa. There are eight forms of homeowners insurance. They range in name from HO-1 through HO-8 and offer different levels of protection depending on the needs of the homeowner, and the type of residence.

There are three common levels of coverage:

  • Actual cash value (ACV) refers to the market value of the item at the time it is damaged or stolen. This value covers the house plus the value of your belongings after deducting depreciation.
  • Replacement cost coverage pays to replace the item you lost with the same or a similar item. This is the actual cash value without the deduction for depreciation, so you would be able to repair or rebuild your home up to the original value.
  • Inflation guard. Many insurance companies include a provision known as inflation guard in homeowner insurance policies so values increase on a yearly basis.

Most policies’ hazard coverage doesn’t include business equipment, damage caused by natural disasters, or loss of art or jewelry over a certain amount, unless the policy specifically covers these types of events.

You can purchase a special policy that specifically covers your most valuable or irreplaceable possessions. You can also purchase a separate policy specially tailored to cover rare and valuable collections.

Talk to a qualified real estate attorney or local insurance companies if you have additional questions about what a home insurance policy covers or if you need help with a lawsuit.

Thomas Elliott

Education: Brooklyn Law School, Brooklyn, New York. Pace University, White Plains, New York.
Professional Associations and Memberships: American Bar Association, New York State Bar, The Association of the Bar of the City of New York, Brooklyn Bar Association, National Academy of Elder Law Attorneys (NAELA).

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