Homeowners insurance is a type of insurance that protects you in case of damage to your home, property, and (depending on the policy) your belongings. This damage could be caused by various factors, including fire, weather, smoke, acts of vandalism, or theft. 

Homeowners insurance covers losses and damage incurred to your home and property and will give you a sum of money when you make a claim to help you repair or rebuild the things that have been damaged. 

Most homeowners insurance policies do not cover damage caused by floods or earthquakes (these are separate insurances). Damage caused by insects, bugs, or neglect usually won’t be covered either. Expensive items such as jewelry and artwork may not be covered by your policy and may require you to purchase additional coverage if you want to insure them. 

 

How Much Coverage Do You Need?

How much home insurance coverage you need depends on the value of your home, property, and assets. As a rule of thumb, you’ll want enough coverage to rebuild your home and replace missing belongings. You’ll also want to cover costs incurred from having to live outside of your home (at a hotel, for example) while the damage is being repaired. 

While it’s best to calculate exactly how much coverage you should get for home insurance with an insurance agent, it may be helpful to know that a minimum homeowners insurance policy usually provides $100,000 of coverage. Recommended amounts, however, are in the range of $300,000 to $500,000.

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