Homeowners Insurance – Detailed Information

Homeowners Insurance Policy Types:

Homeowner’s insurance policies provide coverage for losses to your home, your personal belongings, and also for detached structures on your property. It also provides protection in the event of an injury to people on your property, as well as liability for injuries and damage you cause to other people. It provides for loss of use of your home if you are unable to continue to live there because of an insured loss.

As a homeowner, there are generally three types of home insurance policies you could purchase; Comprehensive, Broad and Named Perils Coverage. In special circumstances, a Basic or Fire & Extended Coverage policy may be purchased / required.

Not all policy types cover the same things. This is why we take the time to get to know our clients, to understand their needs and craft an appropriate package for them.

Comprehensive Coverage:

This is the most inclusive home insurance coverage available, and is sometimes referred to an “All Risk Policy.” It covers the building (dwelling) and its contents for all risks except those that have been specifically excluded in the policy documents. An example of such exclusion would be a sewer backup – which is naturally excluded by the policy. However, an individual can purchase additional coverage to ensure the removal of that exclusion and coverage will be provided for this type of loss. This is typically more expensive.

Broad Coverage:

If the comprehensive policy costs more than you want to pay, this is the next option. This policy provides comprehensive coverage on the building and named perils coverage on contents. Broad coverage would enable you to have “All Risks” coverage except for the named exclusions on the dwelling, and only coverage for spelled-out perils on the contents. Named perils are generally:

  • Air and vehicle impact
  • Electrical current
  • Escape of fuel oil
  • Explosion
  • Falling object
  • Fire
  • Lightning
  • Riot or civil disturbance
  • Smoke
  • Theft
  • Transportation
  • Vandalism
  • Water Damage (with limitations)
  • Wind and Hail

*this may vary from policy-to-policy

Remember, not all companies have the same home insurance options. Many use brand names with variations of coverage. Check your policy carefully.

Named Perils Coverage:

If you are looking to save money by carrying the financial risk of some losses yourself, you may wish to consider a named perils policy that covers only those perils that are specifically stated in your policy. This covers only perils listed below. This is a more affordable policy but results in more homeowner risk. Limits for contents are usually lower with this type of policy.

  • Air and vehicle impact
  • Electrical current
  • Escape of fuel oil
  • Explosion
  • Falling object
  • Fire
  • Lightning
  • Riot or civil disturbance
  • Smoke
  • Theft
  • Transportation
  • Vandalism
  • Water Damage (with limitations)
  • Wind and Hail

*this may vary from policy-to-policy

Not all companies have the same home insurance options. Many use brand names with variations of coverage. Read your policy carefully.

Basic Coverage / Fire and Extended Coverage:

Some insurers offer a very basic, very limited coverage. They may only be offered if the dwelling to be insured does not meet the minimum standards of the insurer, or if there have been multiple claims. Often, there are problems that need to be addressed that may increase the risk of having a claim. The premium can vary greatly depending on the situation and insurer offering the coverage.

Perils usually covered:

  • Fire or lightning
  • Windstorm or hail
  • Explosion
  • Riot or civil commotion
  • Aircraft
  • Vehicles
  • Falling objects
  • Smoke

*this may vary from policy-to-policy

Not all companies have the same insurance options. Many brand names offer variations of coverage. Check your policy carefully.