Understanding a Basic Homeowners Insurance Policy
Everyone would agree that buying a home is a major purchase. Even with the decline in the housing market in recent years buying a house is still quite expensive and the best way to protect that investment is with a good homeowners insurance policy. In fact, if the purchase of your house requires obtaining a loan, your lender will more than likely require that you carry at least basic homeowners insurance. This article will talk briefly about what's covered and what's not covered in a basic homeowners insurance policy and gives some tips to make sure you get the best coverage at the best possible price.
A basic homeowners insurance policy will cover a number of potential hazards known in the industry as "perils". The following perils will be covered by any homeowners insurance policy. Fire or lightning, smoke damage, explosions, wind storm or hail damage, damage from the build up of snow sleet or ice, damage caused by vehicles or aircraft, vandalism, theft, water damage due to plumbing failure, damage from the electrical surges, falling objects, volcanic activity, and riots or civil unrest.
That list is fairly long and seems like it includes just about everything but a couple of major events that would not be covered would be earthquakes and flooding. Insurance is available for earthquakes and floods but is not part of a basic homeowners insurance policy. To be protected against those particular perils would require the purchase of additional homeowners insurance. If you live in an area that is prone to flooding, obtaining flood insurance may be difficult. However, if you live in an area where floods are not too common flood insurance would be very inexpensive and may be a good investment. Even in areas that don't see flooding on a regular basis, all it would take is a blocked up storm drain in a heavy rainstorm to cause flooding. Just a couple inches of water inside your home can do thousands of dollars worth of damage.
Whether you decide to include earthquake and/or flood insurance, or you decide to go with the most basic homeowners insurance policy, the policy would cover your dwelling, your personal property, and some degree of liability insurance. The dwelling refers to the actual structure of your home. If your home was damaged the insurance benefits would be used to repair or rebuild the structure. Personal property refers to all of the items inside your home that are not part of the structure. This would include everything from major appliances to jewelry and knickknacks. Liability coverage would protect you in the event that someone were injured on your property. The amount of liability coverage would very from one policy to another.
All of the items discussed above are the items that would typically be covered under a basic homeowners insurance policy however the dollar amounts of the benefits to be paid out, the monthly premium payments, and the deductibles will all be different from one policy to the next. The best way to make sure you get the most coverage at the most affordable price would be to do some comparison shopping. Get multiple quotes from several different insurance providers and you can easily determine which quote will be offering the best coverage at the best price.
The key to getting the best coverage at the lowest price is to get free homeowners insurance quotes. Doing comparison shopping will save you thousands of dollars. For answers to your homeowners insurance questions visit http://www.homeowners-insurance-questions.info
Source: http://ezinearticles.com/
Added: September 11, 2008
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