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Why you need homeowners insurance
Homeowners insurance is a requirement. It satisfies your mortgage company or lender if there is a loan on your property. Homeowners insurance also protects your assets. It covers the building, your personal property and protects you against legal responsibility arising from a lawsuit.
Homeowners Insurance Coverages
The standard Homeowners Insurance policy contains two sections. Section I provides coverage for A, B, C and D (property). Section II of the policy provides coverage for personal liability, Coverage E & F. Below is a brief description of what the individual coverage means.
Coverage A –is the Dwelling or Building to be insured (protects your home and attached structures if damaged by a covered peril).
Coverage B – Other Structures (detached structures or structures not attached to the home such as detached garage, hobby shop, etc. Usually 10% of coverage A).
Coverage C – Personal Property (personal belongings owned by you, clothing, furniture, appliances, etc.). Usually 50% of Coverage A (limitations apply).
Coverage D – Loss of Use or Additional Living Expense (the cost for insured to live elsewhere in the case of a covered loss where your home is inhabitable).
(Sometimes shows as Coverage L in some policies)
Coverage E – Personal Liability (protection for the homeowner in case of legal responsibility arising from injury to others. Also includes legal defense). Intentional acts are excluded.
(Sometimes shown as Coverage M in some policies)
Coverage F – Medical Payments (reimburses for reasonable medical expenses for someone accidentally getting injured on insured property up to policy limits and only applies to non-household members)