When you've spent considerable time and money buying a house, you want to protect your investment. Luckily, home insurance offers coverage for a variety of events and types of damage to guard you financially in case something unexpected should happen. Here are some common questions about home insurance to help you navigate the policy selection process.

A Guide to Home Insurance

What does it cover?

The three primary types of home insurance coverage cover the dwelling, your personal property, and your general liability as a property owner. Dwelling coverage protects the house, any outbuildings like sheds or garages, and other structures on the property like fences or decks if they are damaged by a covered event. Personal property coverage ensures that you will be reimbursed for personal belongings in the house, such as furniture, appliances, and clothing if they are damaged in a covered peril. Finally, general liability coverage pays for damages, medical care, and legal fees if someone accidentally injures themselves on your property.

What perils are typically included?

Most policies cover perils like fire, windstorms, falling objects (including rain and snow), lightning, vandalism, and theft. On the other hand, few carriers cover damages caused by floods, earthquakes, or mudslides. However, you can typically buy separate coverage for those to ensure your property is protected. You can speak with an insurance agent to determine what policy best suits your needs.

Is it required by law?

Unlike auto insurance, which most states require by law, home insurance is not legally required. However, some lenders may require it as a condition of their mortgage loan. More generally, home insurance is a wise investment that can protect you against significant out-of-pocket costs in the event of serious damage. 

What are the differences between actual cash value (ACV) and replacement costs?

In the event of a total loss, ACV coverage pays out to you the actual value of the house at the time of the event. This may or may not be enough to rebuild the home and restore it to its previous state. Replacement cost coverage, on the other hand, guarantees that your house will be returned—as closely as possible—to its condition before the event. While ACV coverage is less expensive, it does not offer the same protection or peace of mind as replacement cost coverage does.

If you're looking for a reliable home insurance provider, contact Elisa Hager in O'Fallon, IL. She has served St. Clair County and the surrounding areas since 1988, offering quality products, friendly service, and invaluable guidance to help you navigate the complex insurance landscape. Reach out to her online through her Facebook page, or call (618) 628-8800 to request a home insurance quote.