Balfour Insurance Agency

Homeowners Insurance is for owner occupied properties. They are essentially designed to bring your home and property back to the same condition they were in before a loss occurred. There are several types of homeowners policies offered by a wide variety of insurance companies and not all coverages are the same or are available in all states. While reading through the information below, you should keep in mind these definitions: (a) Exclusions are situations where your policy does not provide coverage and (b) Liability is something for which you are legally responsible.

Dwelling (referred to as Coverage A on most policies)

Imagine your home empty, before it has been filled with your things. This is the part referred to as Coverage A: your physical home (rooms, fireplaces, tile floors, carpeting, etc. ) and the structures attached to it, such as an attached garage.

The amount of coverage assigned to your dwelling should reflect the amount it would cost to completely repair or rebuild your home should it suffer a covered loss. Replacement cost should be determined by using  construction estimating software. Most Insurance Agents and Companies can provide an estimate after asking you detailed questions about your home.  Never use your home's purchase price! Why, sales price has no relation to the actual cost to rebuild. The Sticks and Bricks of the home, in addition land dose not burn. Land is a large part of the home's cost.  However, if it's been a while since you last updated your policy coverage or if you are not sure that your dwelling is adequately covered, you can check with your agent. Please remember the home owner is ultimately responsible for the Coverage amounts on the home.

Other Structures (Coverage B)

Not all structures that exist on your property are actually attached to your house. Therefore, Coverage B offers insurance protection for the other structures such as a detached garage, gazebo, or storage shed.

Personal Property (Coverage C)

Your personal possessions, you things, such as pots, pans, sheets towels, dishes, toothpaste, furniture, clothing and appliances are covered. Certain types of possessions maybe excluded or have limited coverage.  Also, special collections or extremely valuable items may require separate insurance protection that is not available within the confines of the average homeowners policy.  Consider Inland Marine coverage for you: Jewelry, Furs, Home computers, China & Crystal, Silverware, Gun collections and More. 

Loss of use (Coverage D)

The coverage can also be called Additional Living Expense. Essentially, this pays for your housing and other living expenses (like meals and laundry) if you suffer a major loss, that makes your house uninhabitable.  Usually you  have to move out temporarily while it's being repaired.

There are 3 types of Homeowners Policies typically sold: The Basic Form (HO-1), The Broad Form (HO-2), and the Special Form (HO-3) but are not inclusive of all the perils and exclusions

HO-1 Basic Form Covered perils: 

A basic form homeowners insurance policy provides protection from the following perils:

• fire
• lightning
• Internal Explosion
• windstorm
• hail
• aircraft
• riot or civil commotion
• vehicles
• explosion
• smoke
• theft
• vandalism/malicious mischief
• glass breakage
• volcanic eruption

HO-2 Broad  Form Covered perils:

A broad form homeowners insurance policy provides all of the basic form perils plus the following perils:

• falling objects
• weight of ice, snow or sleet
• freezing of plumbing
• accidental plumbing discharge or overflow of water or steam
• rupture of steam or hot water heating system, air conditioning systems, or water heaters
• damage from artificially generated electricity

HO-3 Special Form Covered perils:

This is the inverse of the Basic and Broad forms, Special Form cover's anything that happens as long as it is not excluded.  Please note under the HO-3 the Dwelling  (Coverage A) & Other Structures (Coverage B) are covered  under the Special Form Perils,  but the Personal Property (Coverage C) is covered by the Broad Form Perils.  You can pay extra and purchase the Special Perils coverage for Personal Property (Coverage C).

Common Exclusions:

These are some of the most common exclusions for a homeowners policy, but not all.  Homeowners insurance does not provide coverage for the following perils:

• loss due to flood
• water that backs up through the sewers
• loss to building by earthquake, aftershocks and mud slides
• loss by enforcement law or ordinance regulating construction, repair or demolition, or zoning
• loss due to power interruption when the interruption takes place off the residence property
• loss due to neglect of the insured to save and preserve property following a loss
• war and nuclear perils
• intentional loss

Theft protection: the homowners owners policy also protects your property against practically every type of theft loss in your home or anywhere in the world (Limited coverage for personal property away from the premises). Also included is coverage for thefts from your unattended car or boat, even if there is no evidence of forced entry.

Deductibles

With a homeowners policy, a deductible applies to the property portion of the policy Coverages . A deductible is the amount you would have to pay out of your own pocket before the insurance coverage kicks in.  Typical deductibles are , $500, $1,000 or higher and some policies have several deductibles. The higher the deductible you select, the lower your premium payment is.

Personal Liability Protection (Coverage E )

Liability coverage is important protection in the event that you are sued for accidentally hurting other people or damaging their property. Personal liability helps to cover the associated legal costs and related damages. Most Homeowners policies provide $100,000 (minimum) of financial protection against liability claims and lawsuits brought by others for accidental bodily injury or damage to their property:

• while in your home
• caused by your personal activities, including most sports
• caused by your children or pets

Medical Payments to Others: (Coverage F )

Most policies will pay up to $1,000 per person in medical bills--regardless of your legal responsibility--when an accident involves bodily injury to others. Higher coverage amounts are available.

Damage to property of others:

Should you accidentally damage someone else's property while that property is in your care, your Homeowners policy should pay up to $500 for each occurrence.