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Four Kinds of Homeowners Insurance Coverage

home-8There are just a handful of different homeowners insurance policies commonly available to consumers to insure their homes and personal property.

There are four kinds of homeowners insurance coverage offered by most companies: Dwelling, Other Structures, Personal Property and Loss of Use or Additional Living Expenses. So when you get your homeowners quotes check to see exactly what’s included.

The first coverage is Coverage A – Dwelling. This typically covers the value of the home excluding the land. Normally, there is a co-insurance clause attached to this coverage, indicating that any loss will be adjusted to replacement cost, which is defined up to the policy limits for as long as the house is insured at 80% of actual value.

Except for the Tenant form or HO4, all other forms have this coverage. Although there is additional coverage for improvement costs of the house being rented for those holding a HO4 type of policy. Slash Your Homeowners Insurance Rates. Search for Lower Rates.

The second coverage is Coverage B – Other Structures. This covers the structure for residential purposes. This coverage usually has a limit of 10% to 20% of the value of the insured house but additional coverage may be obtained for higher costs.

The third coverage is Coverage C – Personal Property. This covers all personal property or the contents of your home. However, losses on specific kinds of items have limits for theft. If you have a coin, medal or bullion collection, the are excluded from coverage C. Other items include banknotes or cash. This coverage comprises 50% to 70% of coverage A.

The fourth coverage is Coverage D – Loss of Use or Additional Living Expenses. This insurance coverage is related to additional expenses incurred if the owner has to rent a home or other welling while a damaged house is being replaced or repaired.

Apart from the property coverage, additional coverages should not be confused with additional living expenses. Additional coverage is for expenses related to repairs that are not included in property coverage. This may include damage to trees, shrubs, debris removal, credit card theft charges and loss assessments.

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