Learning Center I am doing my best to avoid insurance jargon here!
This will cover damages to your home from things like fire, hail, etc. Be sure to check what is excluded in your policy as some types of damage, like flooding or mold, are specifically excluded. You can purchase extra endorsements to get these special items covered as well.
This covers structures on your property that are not attached to your main home. Examples of these structures are detached garages, storage sheds, in-ground pools, gazebos, etc.
This covers damages and theft of your personal property. Personal property includes items like clothing, appliances, and furniture. There are usually special coverage limits for certain item categories like money, jewelry, golf clubs, firearms, video equipment, music instruments, and silverware - that's why I ask about what you own in these categories. If you have special high value items, such as that beautiful engagement ring, consider getting additional coverage for these items.
Loss of Use
Also known as Temporary Housing Expenses, this covers your living expenses if you have to stay in a hotel or somewhere else while your actual home is being repaired from a loss covered in the policy. These additional costs can also include additional food cost, transportation, and other expenses that exceed what you would normally spend if you were still living in your home.
Personal Liability coverage pays for loss settlement and legal fees in the event that you or your family members cause bodily injury or property damage to others. I know everyone can be clumsy at times :)
This coverage pays for medical bills when someone is injured by you personally, or on your property. Reasonable medical expenses are covered, regardless of fault, up to the amount of coverage you select. Still not a free pass to drunken boxing.
Flood damage is usually not covered in your standard home insurance policy. Flood insurance is provided by the National Flood Insurance Program (NFIP). Flood insurance is required in high risk areas. While it isn't required in moderate-risk areas, it's still a good idea. Nobody dreams of a swimming pool in their basement, but it does happen. In fact, people in moderate-risk areas file more than 20 percent of all NFIP flood insurance claims.
Personal Property Replacement Costs
Your personal property loses value over time. Think about the price difference of buying something new vs. used off of Amazon. With furniture and appliances that you have owned for over 5 years, the difference between new and used value may be quite large. If you have to file a claim with the insurance company, you will usually get cash to replace the damaged property at the used cost. If you want to make sure you are being fully covered to replace all your damaged property with sparkly new property, you can add this endorsement. Definitely worth it in my mind.
Personal Umbrella protects you if you have lots of savings or investments beyond just your primary home and want to protect these. This protection especially comes into play if someone tries to sue you for "everything you're worth".
What's that smell? Mold is not covered in a Homeowners policy. Adding this coverage will cover property damage and liability losses arising out of fungi, wet or dry rot, or bacteria. This is an expensive coverage, because mold is expensive to remove. Usually involves tearing up carpet, drywall, or even replacing some part of the house itself.
Water Backup Coverage
Homeowners policies do not cover losses from water that overflows from sump pumps or water that backs-up through sewers or drains. This add-on provides coverage for such incidents. Sump Pumps are found in the basements of homes and are usually installed where basement flooding happens regularly. They are good at sending water away from the home when it rains/floods/etc.
Identity Theft Coveragee
This covers you and your family for expenses incurred as the direct result of identity fraud. These days, with everything going digital, our personal information is becoming more at risk. Getting personal information stolen online is scary! First and foremost, be safe with your information. Second, buy protection.
Personal Injury Coverage
This covers damages to you or your personal brand via libel, slander, false arrest, invasion of privacy, or malicious prosecution. Post a lot online? This may be a cheap way to get protected in case you unintentionally make someone so angry that they file a lawsuit against you.
Home Day Care Coverage
This adds coverage for your in-home daycare. Hope the kids are doing well!
The typical homeowners policy does not provide much protection for business related activities. An add-on to a homeowners policy can provide you additional liability coverage for certain home-based businesses. To fully cover your business, we recommend looking at a Business Owner's Policy or BOP for short. Congratulations on being a business owner! Much respect.
Scheduled Personal Property
The following categories have limits on how much the insurance company will pay out. For example, if you have a really expensive engagement ring (bling bling), you should consider purchasing additional Jewelry coverage. Standard limits in special categories:
- Jewelry - $1,500
- Furs - $1,500
- Electronics - $2,500
- Musical Instruments - $2,500
- Silverware - $2,500
- Golf Equipment - $2,500
- Fine Arts - $2,500
- Postage Stamps - $2,500
- Coins - $200
- Firearms - $2,500
In some states, you can choose Limited Tort or Full Tort.
Limited Tort - allows you to seek payment for medical bills and lost wages in an accident, but not from pain and suffering or other non-monetary damages (unless the injuries are defined as really really bad - loss of a limb, permanent disfigurement/scarring, etc). Well that just got really dark… BUT you can generally save ~30% on your premium by choosing Limited Tort.
Full Tort - has no restrictions on seeking recovery. This is the standard auto policy.
Liability Coverage 1
Covers damage you do to other people and their property in an accident. It will cover things like medical costs, lost wages, sickness, death, and property damage related to the accident. This coverage also pays for pain and suffering that may result from the accident. Stay alert and drive safe!
Uninsured & Underinsured Motorists Coverage 2
If another driver hits you and it is their fault, but they do not have insurance and cannot pay you. This protects you for medical bills, lost wages, and pain and suffering (depending on your tort option). An estimated 1 in 8 drivers are driving without insurance! We live in a crazy world.
Collision Coverage 3
Covers damage to your own car when you hit, or are hit by, another vehicle or object, regardless of who is at fault. The deductible you select is the amount you must pay out-of-pocket before insurance pays for this coverage.
Comprehensive Coverage 4
Covers you for non-collision related damages to your car, such as theft, vandalism, hail, fire, or hitting an animal. Rudolf, nooooo! The deductible you select is the amount you must pay out-of-pocket before insurance pays for this coverage.
Personal Injury Protection
Personal Injury Protection (PIP or "No-Fault" coverage) is mandatory in certain states (like NY). If you are a driver in NY, PIP covers $50,000 per person for:
- Medical Expenses
- Work Loss Benefits: 80% of lost earnings from work up to $2k per month for a max period of 3 years
- $25/day for other reasonable expenses (for a duration of 1 year)
- Death Benefit of $2k
To cover guest passengers when driving outside of your home state (NY), you must purchase "Additional PIP".
Additional PIP allows you to add the following:
- Out of State Extension - extends coverage at mandatory limits for guest passengers who are not residents of the state and get injured while driving outside of your home state (of NY)
- Full Additional PIP - includes the Out of State Extension, plus doubles the coverage per person ($100k), doubles the Work Loss Benefit ($4k per month), and doubles Other Reasonable Expenses ($50/day)
Medical Expenses 5
Pays for your medical and rehabilitative expenses from an accident, regardless of who is at fault. This coverage pays before your health insurance policy.
If you can't work or lose income as a result of your accident, this coverage will generally pay up to 80% of your lost gross income (up to your policy limits).
Lease Loan Payoff
If your vehicle is totalled in a crash, the insurance will pay the difference between the settlement amount and the amount you owe your lender (usually up to 25 percent of your car's actual cash value). Only consider this coverage if you lease your vehicle or have a loan. This way if your car is destroyed you won’t owe a ton of money to the lender for a car that no longer works.
Coverage for roadside repairs or towing services when your vehicle breaks down due to mechanical or electrical issues, a dead battery, a flat tire, a lock-out, or if you run out of gas. Watch that gas light!
Insurance pays for a rental car while your vehicle is being repaired. This coverage is available if you have Comprehensive and Collision coverage.
If you die in a motor vehicle accident (within 24 months), your family receives compensation up to your coverage limit. Dark.
Insurance pays for funeral, burial or cremation expenses if you die as the result of a car accident. If you want your ashes launched into outer space, you may need additional coverage.
Disclaimer: These coverage definitions and examples are based on ISO standard forms. Coverage definitions may differ from carrier to carrier. We suggest reading your policy to understand the specific details.