What does homeowner’s insurance cover?
Homeowner’s policies are designed to provide financial protection in the event of damage to your home, such as fire or water damage. Your policy will also protect your personal property, such as furniture that is damaged as a result of a fire, or the theft of electronic equipment. In addition you will be protected from liability as a result of homeownership, such as a visitor who slips on your icy steps and breaks an arm.

The standard homeowner’s policy covers the following:

• The physical structure of your home, permanent structures on your property, and your personal property.
• Personal liability exposures that arise from being a homeowner.
• Additional costs that you may incur as a result of a covered loss, such as a fire in your home that makes it uninhabitable.

The homeowner’s policy that you purchase determines which perils you are insured against. Most homeowner’s policies are written under the HO-3 contract form. Form numbers are standardized, so if you purchase HO-3 insurance, you’ll get the same coverage regardless of your insurance provider. The HO-3 contract form provides coverage for the following:

• Broad coverage for your dwelling. Damage to your dwelling from most causes is covered unless it is specifically excluded.
• Damage to your personal property for “named perils” only. Your personal property is covered only against the perils specified in the contract.
• Limited coverage for jewelry that is stolen. Coverage is usually $500 to $2,000, depending on your state of residence. Most policies don’t cover jewelry that is lost.

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