Home Insurance Coverage Explained

A homeowners policy is usually organized into a handful of parts: the dwelling itself, other structures such as a detached garage or fence, your personal property, additional living expenses if you're displaced after a covered loss, personal liability, and medical payments to others.

The gaps we see most often are dwelling limits that haven't been reviewed in years, no water backup endorsement, no scheduled coverage for jewelry or other valuables, and liability limits that no longer match the household's situation.

Replacement cost versus actual cash value is worth understanding as well. With actual cash value, depreciation is factored into a covered loss. Replacement cost coverage is generally available for belongings and changes how a claim is settled.

Flood damage is generally excluded from home policies. If that's a concern for your property, separate flood coverage may be available.