Insurance Basics [1] [2] [3] [4] [5]

Common Coverage Terms

Dwelling or Residence Coverage (Coverage A) - The dollar amount carried to cover your home and any structures attached directly to it.

Other Structures or Related Private Structures Coverage (Coverage B) - Covers those structures not permanently attached to your home. Examples: detached garage, gazebo, storage shed, pool, boathouse.

Personal Property Coverage (Coverage C) - The coverage protects your personal property, whether you're at home or away from home, on a named-peril basis with certain limitations. Examples: artwork; certain types of business property; firearms; jewelry; watches; furs; precious and semi-precious stones.

Loss of Use (Coverage D) - This coverage is available when you can't live in your home due to a covered loss. It pays living expenses, which go over and above your normal living expenses up to the limit provided in your policy. This coverage may also be referred to in some insurance policies as Additional Living Costs or Expenses.

Medical Expenses/Payments (Coverage F or M) - This pays emergency medical bills and reasonable and necessary medical expenses for anyone injured on your property or any injury caused by a member of your family or a pet, regardless of where it happens. All bills are paid, up to your policy limit, whether or not you are directly or legally responsible.

Personal Liability (Coverage E or L) - This provides coverage for bodily injury or property damage for which you are legally responsible. Most homeowner policies provide a minimum of $100,000 of liability protection. Other amounts may be purchased.

Examples
1. A guest to your home falls on a patch of ice on your driveway or walkway.
2. Your dog bites the mailman on your front porch.
3. Lightning strikes a tree on your property and it lands on your neighbor's home.

Umbrella or Excess Liability Coverage - This provides higher limits and broader liability coverages. This may be purchased as an attachment to your policy or as a separate policy.

Deductibles
A deductible applies to the property portion of the policy. Typical deductibles are $100, $250, $500 or higher and some policies have several deductibles for different types of losses. In general, the higher the deductible you select, the lower your insurance premium will be. (Note: $100 deductibles are usually only available for renters and condo policies)

Flood Insurance
Flooding is not covered by a standard homeowners policy. Flood insurance can be purchased from an insurance agent or company under contract with the Federal Insurance Administration (FIA), part of the Federal Emergency Management Agency (FEMA). Flood insurance is only available where the local government has adopted adequate flood plain management regulations under the National Flood Insurance Program (NFIP).

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