Understanding homeowner insurance
A home is usually the largest purchase you will make. Protecting this major investment can be important to your family’s financial future.
If you have a mortgage, your lender will require you to have homeowner insurance. If you do not have a mortgage, it is a good idea to protect your investment and buy homeowner insurance.
What it covers
Homeowner insurance pays for damage to your home and other structures on your property. It also may cover:
- Damage to or loss to contents of your home
- Your liability for accidents that occur on your property or for damage to others’ property.
What it does not cover
- Floods: Flood insurance is typically provided through the National Flood Insurance Program. You must buy flood insurance through an agent. Get a referral at 888-379-9531 (toll-free).
- Earthquakes: You can buy earthquake as a separate endorsement to your homeowner
or renter policy or as a stand-alone policy that is separate from your homeowner
- Landslides (earth movement) are not covered. This type of coverage may be
difficult to obtain. Talk to an agent.
- Cannabis related
properties: There may be coverage gaps when insuring cannabis related
Create a home inventory
After a major loss your insurer will ask for a detailed list of personal property items. Creating a list of all of your belongings from memory would be difficult at any time. Creating a list when you’re dealing with a tragedy is nearly impossible.
You should create an inventory of your possessions every year. The NAIC provides a number of resources for building your home inventory, such as sample checklists and mobile apps, available here.
For the classroom
Homeowner insurance game PowerPoint presentation