Home Insurance Policy Options

Homeowners insurance is a type of insurance purchased by homeowners to protect themselves financially in the event of legal liability or property damage caused by covered perils such as falling trees, windstorms, theft, vandalism, fires, burst water pipes and more. Examples of liability claims may include a dog bite, slip and fall, injury, or death at the residence premise. Some companies personal liability coverage on a home policy also extends off of the residence premises for family members.

There is no difference between home insurance vs. homeowner's insurance.

While the law does not require homeowners to carry home insurance, mortgage lenders generally do. If you are uncertain, it is best to check with your mortgage lender to confirm.

While private mortgage insurance (PMI) set by your mortgage lender can be included in your mortgage escrow (does not apply to everyone), general homeowner's insurance is not included in a mortgage, but rather paid monthly or annually like auto insurance. However, your mortgage company will typically give you the option to set your home insurance payment plan to be 'paid by escrow'. This means that you can have your mortgage company pay your homeowner's insurance bill each year and in return it comes out monthly from your mortgage escrow account.

According to NerdWallet, the average cost of home insurance in 2022 is about $1787/year. However, there are many factors that go into determining price and this average varies by state. Some companies will run a soft hit to your credit or insurance score and they also factor in the size and condition of your house along with your state and zip code and several other factors.

While homeowner's insurance is not required by law, you will likely need a home insurance policy if you plan to finance your home through a mortgage lender. Having homeowner's insurance is a smart idea for any homeowner in the event of natural disasters, house fires, theft or vandalism, unforeseen and unavoidable accidents, or in the event someone is hurt on your property and decides to sue you, or requires medical attention.

Yes, a standard homeowners insurance policy typically offers both property and liability protection for you and your home. It also typically covers other structures on your property besides your home like garages, sheds, and fences. It can also cover personal belongings within the home and those other structures, along with loss of use coverage (should you be displaced from your home temporarily due to a claim).

Mortgage insurance is not the same as homeowner's insurance. Mortgage insurance is an insurance set by your mortgage lender that compensates the lender if a homeowner were to default on their mortgage.

In order to buy a property, the property's title record must be "clean," meaning, free from unresolved claims on the property. Title insurance is a type of insurance designed to protect homebuyers and mortgage lenders from financial loss caused by a defective property title. Typically, lenders require the borrower to purchase lender's title insurance, ensuring the lender is protected financially in the event there is an issue with the title.

The answer to this can vary greatly by state and also by company. It is best to work with a local agent such as Peterson Insurance to review what each company's policy is offering and what it is excluding. Furthermore, a lot of carriers exclude some things like flood, earthquake, sinkhole, and some high valued items coverage but you can choose to add these coverages by endorsement or with a separate policy like Flood insurance. In general, however, most homeowner's insurance policies will not cover general wear and tear, risky items such as trampolines (unless they have a net or you get prior underwriting approval), or damage due to negligence. A standard home insurance policy typically excludes insect, bird, or rodent damage, mold or rot, or smoke damage. Additional insurance policies like flood and additional endorsements like siding and roof restoration, underground service line coverage, and sewer and drain backup coverage can be purchased to help cover other claims a standard home insurance plan won't otherwise cover.

Loss of use in home insurance is a coverage type initiated when a covered loss causes a home to become inhabitable. Loss of use coverage pays for any additional cost incurred for housing and living expenses while your existing home is being rebuilt or repaired due to the homeowner's insurance claim.