A basic home insurance policy covers four main areas:
Liability
Personal general liability under home insurance covers accidents of bodily injury and property damage someone else may suffer. For example, if a visitor trips and falls in your home, liability insurance can help pay for their medical bills. It can also protect you in case of a lawsuit regarding these types of accidents. Liability can also extend to cover damage and injuries caused by your children or pets. If your pet bites someone, or if your child accidentally breaks someone’s window with a baseball, liability insurance can help pay for the related expenses.
Dwelling
Dwelling coverage provides compensation for damages to the physical home and its attached structures. It covers against a list of perils, including fire, wind, hail, lightning, smoke, explosions, falling objects, theft and vandalism. This does not generally cover things such as fences and outdoor signs.
Personal Belongings
Personal belongings coverage provides compensation if your personal items are lost or damaged due to many of the same perils as covered by dwelling insurance. There are also optional policy floaters available to cover your expensive items such as jewelry, furs, art and electronics.
Additional Living Expenses
Additional living expense coverage helps cover costs related to temporarily moving if your home is rendered uninhabitable by a disaster. If a hurricane sweeps in and destroys your home, for example, this coverage can help with the cost of food, temporary shelter and more.