What Should A Home Insurance Policy Cover?

A person's largest single asset by monetary value is often their house. Consequently, you'll want to have a home insurance policy that appropriately covers all of your risk exposure. What does it mean to have the right coverage, though? Let's look at how to choose the right features for your policy.

Total Loss

One of the biggest insurable risks is the total loss of your house. If a fire happens, for example, you might need to construct a new home from the foundation up. When an agent calculates the value of total loss coverage, they have to look at the size of the home, the current local housing market for similar places, and the current construction market for building a similar structure.

Notably, it's a good idea to revisit your home insurance policy once a year to keep up with the market. If a recent housing boom has driven up prices, you'll want to be sure your policy still covers the replacement cost of building a new home in your area.

Premises Liability

All homeowners face potential liability exposure whenever anyone comes onto their premises. Premises liability is the notion that a homeowner has a duty of care to perform essential maintenance to prevent others from suffering injuries. For example, you might be liable if someone trips on a heave on the sidewalk between your house and the road. Similarly, you could be liable if something like a tree branch falls on a passerby.


Many people will also want to insure the contents of their homes. After all, you've spent part of your life buying nice things like your TV, cell phone, appliances, and so on.

Notably, there are issues regarding named and open perils. If you only want to insure specific items in the house, you can probably reduce part of your costs by acquiring a named perils policy. Conversely, if you have lots of nice stuff and want to insure everything, it may be better to have open perils coverage.


It is also a good idea to discuss the specific disasters that might occur at a location. Notably, some places are not insurable for flood risks through an insurer, and you may have to purchase a policy through the federal government. Similarly, you should discuss the costs of insurance against disasters like storms, earthquakes, and wildfires. You want to know long before an event is even a possibility that you'll be covered. 

For more information, contact a local insurance company like Belus Group Ozarks.